Markets

Tokyo shares shed 0.73pc by noon

Published Updated

The Nikkei index at the Tokyo Stock Exchange fell 61.29 points to 8,362.33 in the morning session. The Topix index of all first section shares fell 0.34 percent or 2.45 points to 719.00.

Markets got little relief from Italy's successful auction Wednesday of 9.0 billion euros ($11.8 billion) in six-month bonds at low rates, with euro worries instead dominating trade.

The average rate on the debt was 3.25 percent, half the 6.50 percent paid in a similar operation in November, when worries that Italian finances might collapse filled the markets.

But news that eurozone banks deposited a record amount of overnight funds at the European Central Bank on Tuesday -- breaking a record set only the day before -- showed there were still deep tensions in the single-currency zone.

Sentiment soured as yields on 10-year Italian bonds jumped to a painfully high 6.9 percent later on an uneasy day, raising worries about Rome's plans to sell longer-term bonds on Thursday.

"Investors are shifting to domestic demand-related stocks on defensive buying," Chibagin Asset Management fund manager Hiroaki Osakabe told Dow Jones Newswires.

He noted investor aversion to currency-sensitive stocks due to euro weakness.

In New York Wednesday, the single European currency fell to 100.73 yen, its lowest level since June 2001, while also plunging against the greenback below the $1.30 line to its lowest level since January 11.

The euro continued its fall against major currencies also in early Tokyo trade, touching as low as $1.2887 and 100.35 yen at one point.

In midday trade, the euro had recovered slightly against the dollar and was quoted at $1.2926, compared with $1.2912. It traded at 100.56 yen.

The dollar stood at 77.80 yen, slightly down from 77.90 in New York.

Copyright AFP (Agence France-Presse), 2011