Tokyo closes lower, Taiwan surges


The weaker yen failed to help Japanese exporters make significant gains on the Tokyo stock market tuesday

TOKYO, Japan -- Tokyo stocks closed lower in thin trade Tuesday, led by a slide in Mizuho Holdings and other banks on concerns about Japan's wilting economy.

The weaker yen -- it slipped as low as 130.8 against the U.S. dollar in Tuesday trade -- and the flat close for Wall Street on Monday also weighed on the Tokyo market.

The benchmark Nikkei 225 average lost 0.78 percent or 80.64 points to 10,254.81, while the broader TOPIX index finished down 4.7 points or 0.47 percent at 1002.82.

The Nikkei initially rose Tuesday on strength among selected tech stocks such as Toshiba and Hitachi, before slipping into the red as the day wore on.

Virtually all other markets in the region, including Australia, New Zealand, Korea, Singapore and Hong Kong, were closed Tuesday for the Christmas holiday.

Taiwan, China, Thailand open


Taiwan's Chunghwa Telecom rose 3 percent on reports it would again woo U.S. investors next year

Apart from Japan, the only other major markets to be open were Taiwan, China and Thailand.

Taipei's Taiex strengthened dramatically, putting on 4 percent or 208.08 points to close at 5372.81. Technology and financial shares led the way.

Quanta Computer was again one of the star performers, adding 5.1 percent to T$113.50. Chip foundry TSMC put on 3.1 percent to T$83.50, while banking leader Chinatrust Commercial Bank rose almost 4 percent to T$20.90.

Taiwan's state-owned telco Chunghwa Telecom rose 3 percent to T$51.50 on reports it would revive plans to sell a stake to U.S. investors in the first half of 2002.

In China, the Shanghai B share index was up 0.25 percent to 166.602 in late trade, while Shenzhen's B share index was a little stronger, adding 1 point or 0.39 percent to 260.445.

Shenzhen Expressway made a strong debut in the domestic-only A-share market, jumping 70 percent above its initial price offer of 3.66 yuan.

Thailand's SET was up 0.75 points or 0.25 percent to 302.76 at midday, led by banks.

Brokers down on Argentina woes

In Tokyo, brokers emerged as the big losers after Argentina on Sunday swore in an interim president who immediately suspended payments on some of the country's $132 billion debt, effectively heralding the biggest debt default in history.

Nikko Cordial Corp, Japan's third-largest brokerage house, tumbled 4.84 percent to 550 yen.

"There seems to be no stopping deflation and in turn the rise in bad debts crippling the financial system," Shoji Hirakawa, strategist at Kokusai Securities, told Reuters news agency.

"Plus, a large number of financial institutions and corporations hold Argentine bonds-uncertainty over which is another minus factor weighing on the market."

In the banking sector, Mizuho Holdings fell 1.53 percent to 258,000 yen after going as low as 240,000 yen during the day.

That fall came after the nation's top financial watchdog ordered regional bank Fukushima Bank to boost its capital base, reduce dividends and executive bonuses, and restrict unprofitable deposits.

The news on Fukushima renewed investor concerns about the fragile balance sheets of Japanese banks, traders said. Fukushima plunged 26.09 percent to 68 yen.

Third-ranked Mitsubishi Tokyo Financial Group lost 4,000 yen or 0.47 percent to 846,000 yen after dropping to 832,000 yen.

Reshuffle likely for Matsushita units

Matsushita Electric Industrial Co Ltd jumped 3.66 percent to 1616 yen after the electronics maker said on Tuesday it was considering purchasing shares in five subsidiaries to make them fully-owned units.

Toshiba, Hitachi, Fuijitsu, NEC and Mitsubishi Electric were other tech-related stocks to strengthen. But consumer electronics leader Sony was off 110 yen or 1.93 percent to 5580 yen.

Mobile phone leader NTT DoCoMo dropped 30,000 yen or 2 percent to 1.48 million yen after it said it would pay $380 million to AT&T Wireless Service to keep its stake at 16 percent.

Even the yen's fall to fresh three-year lows against the dollar failed to inspire active buying in shares of Japanese exporters. A weak yen usually inflates their overseas profits when repatriated.

"Despite the weak yen, technology issues suffered because of the lack of their main buyers -- foreign investors -- due to the Christmas holiday season," Tokio Furuta, general manager at Tokai Tokyo Securities, told Reuters.

Reuters contributed to this report.