JAPAN MARKETS-Stock futures plunge 16 pct after PM radiation comments
Japanese stock futures prices
plunged 16 percent on Tuesday as the country’s prime minister
said radiation levels at a stricken nuclear plant had become
high, deepening concerns about the disaster and its likely
economic toll.
Cash stock markets, closed for the regular midday break,
were down 7 percent but were set to fall sharply when trading
resumes.
After Naoto Kan’s comments, Nikkei equity futures prices
dropped sharply, triggering a circuit breaker to halt trade.
When it started again, the futures were down more than 16
percent on the day. Kan also said the possibility of radioactive
leakage had increased.
Japanese government bond prices rose as equities fell. The
pressure on Japan’s already bleak fiscal situation in any
reconstruction was likely to be high, with Japan’s yield curve
steepening some 10 basis points since Friday.
Unlike Monday, when construction stocks rose, none of the
225 constituents of the benchmark Nikkei average were up on
Tuesday.
Four explosions, including two on Tuesday, have occurred at
the Fukushima Daiichi nuclear complex in Japan’s ravaged
northeastern coast since the magnitude 9.0 quake on Friday,
raising concerns about radiation leakage and the longer-term
stability of power supply.
‘All focus is on the nuclear crisis. In the situation where
the crisis appears to be worsening, foreign investors, domestic
fund operators are pulling out from Japanese shares,’ Hideyuki
Ishiguro, a supervisor at Okasan Securities in Tokyo.