TOKYO: Tokyo stocks closed down 1.48 percent Friday on European debt woes as investors nervously awaited the outcome of a European Union summit to stem the crisis.
The Nikkei 225 index at the Tokyo Stock Exchange lost 128.12 points to 8,536.46, the lowest finish since November 30. The Topix index of all first-section issues was down 6.99 points or 0.94 percent at 738.12.
Players remained jittery as they looked for more details from a European Union summit in Brussels, brokers said.
"The situation in Europe is being eyed very scrupulously, but this has been the case for some time now, and will likely continue," Okasan Online Securities Chief Strategist Yoshihiro Ito told Dow Jones Newswires.
Friday's fall came after US stocks tumbled 1.63 percent Thursday on worries Europe will fail to muster the firepower needed to contain its debt troubles with the European Central Bank staying away from increased bond purchases.
The ECB at a governing council meeting on Thursday cut its key rates and boosted measures to help banks, with its Italian president, Mario Draghi, saying the lender would continue to play its part as a firefighter in the crisis, but that it was for governments to solve the problem.
"The ultimate decisions are in the hands of leaders," Draghi said.
Hideyuki Ishiguro, supervisor of investment strategy at Okasan Securities, said: "Draghi's dismissive view prompted profit-taking in stocks that had gained previously on higher expectations."
Stocks also lost ground on the euro's drop against the yen but got some support from a lower-than-expected China inflation figure for November, which stoked expectations that China's policy-easing measures will be expanded.
The euro bought $1.3288 and 103.20 yen in Tokyo afternoon trade, down from $1.3341 and 103.58 yen in New York late Thursday. The dollar was almost unchanged against the Japanese currency, at 77.62 yen.
Divided EU leaders were battling over treaty change at the crunch talks in Brussels with France and Germany seeking backing for their plan to impose budget discipline and streamline decision-making.
British Prime Minister David Cameron said Friday he took a "tough but good" decision to block a change to the EU treaty presented by France and Germany as the way to resolve the eurozone debt crisis.
The market hardly moved on revised Japanese government data that showed the economy grew an annualised 5.6 percent in the third quarter, down from 6.0 percent announced previously.
Shares in Toyota Motor, grappling with a strong yen, the impact of the March earthquake and record flooding in Thailand, fell 0.41 percent to end at 2,636 yen ahead of the automaker's earnings forecast for the full year to March.
After the market closed, Japan's biggest automaker announced a new set of forecasts, slashing its full-year net profit forecast by more than half to 180 billion yen ($2.3 billion).
Its earlier estimate of a 390 billion yen profit was cut as a result of the Thai floods, which forced plant closures and supply-chain problems. The new forecast represents a 56 percent year-on-year fall in net profit.
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