Japan's Stocks Drop on Worsening Sentiment, Writedown Concern
Japan's stocks sank for a third day after rising materials costs dragged business confidence to the lowest in four years, and as concern mounted that financial companies haven't seen the end of asset writedowns.
Sentiment among manufacturers with more than 1 billion yen ($9.3 million) in capital was minus 15.1 points this quarter, the government said today, the lowest since the data was first compiled four years ago. A negative number means pessimists outnumber optimists. The survey also showed companies plan to cut spending on factories and equipment in the year ending March.
Suzuki, Japan's second-largest minicar maker, dropped 2.6 percent to 2,620 yen, while Denso Corp., part-owned by Toyota Motor Corp., slumped 2.6 percent to 3,790 yen. Toyota lost 1.9 percent to 5,310 yen. A gauge representing 63 auto-related stocks dropped to the lowest since May 29.
T&D tumbled 6.3 percent to 6,570 yen, the biggest loser on the Nikkei. Chuo Mitsui, Japan's second-biggest publicly traded trust bank, dropped 4.4 percent to 659 yen, bringing its five-day loss in market value to 102 billion yen. Nomura Holdings Inc., Japan's No. 1 brokerage, retreated 2.2 percent to 1,638 yen. Banks accounted for 30 percent of the Topix's drop.
Sharp Corp., Japan's biggest maker of solar batteries, added 0.8 percent to 1,730 yen, while Kansai Electric Power Co., the nation's second-biggest power utility, climbed 2.5 percent to 2,290 yen. Sharp and Kansai said they would hold a media briefing today on their solar power generation plan.
Meanwhile, the government is expected to reveal its target to halve the price of solar-electricity systems for home use within five years, the Nikkei newspaper reported yesterday. Sanyo Electric Co., a maker of solar panels, jumped 3 percent to 274 yen.

Most European Stocks Fall; Daimler, UBS, Land Securities Drop
Most European stocks fell as higher oil prices damped earnings prospects for carmakers and airlines, while concern deepened that profit outlooks for banks and property companies worsened.
Daimler AG, the world's second-biggest maker of luxury cars, and British Airways Plc retreated as oil climbed above $138 a barrel. UBS AG dropped the most in two weeks after Bank of America Corp. forecast a loss in the second quarter for the Swiss bank.
A report today showed German business confidence fell more than economists forecast in June.
National benchmark indexes decreased in 12 of the 17 western European markets that were open. The U.K.'s FTSE 100 gained 0.8 percent, and France's CAC 40 was little changed, while Germany's DAX added 0.2 percent.
Daimler lost 1.9 percent to 43.53 euros. Renault SA, France's second-largest carmaker, dropped 2.6 percent to 53.56 euros. Michelin & Cie., the world's second-biggest tiremaker, slipped 3.3 percent to 45.50 euros.
Credit Suisse Group AG cut its share-price forecasts for automakers, citing higher oil prices.
British Airways, Europe's third-biggest airline, dropped 3 percent to 212.25 pence.
Royal Dutch Shell Plc, Europe's largest oil company, added 1.5 percent to 1,983 pence. Total SA, the region's third- biggest, climbed 2.1 percent to 52.725 euros.
UBS, which has reported the biggest losses among European banks from the collapse of the mortgage market, dropped 4.4 percent to 22.06 francs. The deficit at UBS will be $1.70 a share, not a profit of 31 cents as previously estimated, Bank of America analyst Michael Hecht said.
House prices declined in June as buyers shunned the market, deepening Britain's property slump, Rightmove Plc said. The average asking price for a home dropped 1.2 percent from May to 239,564 pounds ($473,000), Britain's most-used property Web site said in a statement today. Prices in London declined 1.4 percent.

The euro dropped the most versus the dollar in more than a week as German business confidence fell in June to the lowest level since 2005, reducing bets the European Central Bank will increase borrowing costs this year.
``It's becoming clear that the ECB can't tighten rates aggressively from here,'' said Shaun Osborne, chief currency strategist at TD Securities Inc. in Toronto. ``That will temper the euro going forward.''
The ECB will increase the 4 percent main refinancing rate by a quarter-percentage point by the end of September, while the Federal Reserve's target will remain at 2 percent, according to the median forecast of economists.
According to a survey of analysts and economists, the European currency may trade between $1.53 and $1.58 through the third quarter and fall as low as $1.47 by the end of 2008. That compares with a median year-end prediction of $1.50.
The greenback gained 1.7 percent against the euro this quarter as traders bet the economic slowdown sparked by the collapse of the subprime-mortgage market will spread to Europe as the U.S. recovers.