Nikkei wipes out week's gains

TOKYO, Japan -- Tokyo stocks slackened in early trade on Friday as high-tech issues extended losses despite new stability in the yen, pulling the Nikkei average to 16-year lows and erasing gains from a credit easing three days ago.

"Earnings jitters are weighing on high-tech stocks," said Kazunori Jinnai, general manager at Daiwa Securities SMBC's equity department. "It is a global phenomenon."

Continued falls in Japan's high-tech bellwether Sony Corp and camera and printing maker Canon Inc helped send the tech-sensitive Nikkei down 40.25 points or 0.35 percent at 11,474.77.

Earlier, the Nikkei had fallen as low as 11,412.36, below the previous 16-year intraday low of 11,417.70 marked on Monday.

The Nikkei has now lost all the gains it made since the Bank of Japan's (BOJ) surprise credit easing on Tuesday.

The U.S. dollar was trading around 120.20 yen in early Asian hours on Friday after it made a rapid fall to a two-month low of 119.05 yen in New York on Wednesday.

The Nikkei has fallen more than 70 percent since hitting a record high in December 1989, widely seen as the peak of Japan's asset-inflated bubble economy.

The broader TOPIX index was down 5.64 points or 0.48 percent at 1,169.43.

Sony lost 3.0 percent to 5,830 yen, Canon plunged 3.54 percent to 3,820 and Japan's number one chip maker Toshiba Corp lost 4.09 percent to 586 yen.

News Corp bounces

In Australia, the All Ordinaries index was barely changed after an hour's trading, the index slipping just 0.4 points to 3273.1.

Investors in media heavyweight News Corporation were relieved by the group's profit result released overnight. Revenues and profits were down, but not by as much as expected.

News shares were trading 19c higher at A$17.14 in early business, having fallen substantially all week ahead of the result.

Elsewhere, Australian airline Qantas Airways continued to slide after its profit release on Thursday, the stock easing 7c to A$2.96.

Resource giant BHP Billiton rose 1c to A$9.18 amid revelations it is talking with energy major Woodside about a possible merger.

In Korea, the Kospi opened firmer, trading 4.15 points higher at 585.10 while in Taipei the Taiwan Index weakened 1.94 points to 4685.39 in early activity.

Reuters contributed to this report.