Japanese stocks plunged in Monday’s morning trading following a sharp fall on Wall Street as concerns about European debt problems grew with the euro plummeting against the yen and the dollar. The Nikkei 225 Stock Average lost 396.95 points, or 4.01 per cent, to trade at 9,504.24 while the broader Topix index was down 31.24 points, or 3.51 per cent, at 858.92. Shares on Wall Street plunged more than 3 per cent Friday on poor U.S. unemployment data and fresh European debt worries affecting Hungary.
The U.S. is Japan’s major trade partner, Japanese exporters depend much on the U.S. market. On currency markets at 11 am (0200 GMT), the dollar traded at 91.03—08 yen, down from Friday’s 5 pm quote of 92.70—73 yen.
The euro traded 1.1885—1888 dollars, down sharply from 1.2192—2195 dollars Friday, and at 108.20—24 yen, plummeting from 113.04—08 yen.
A stronger yen makes Japanese exports less competitive and hurts Japanese companies’ overseas earnings when the revenues are repatriated.
