Japan stocks end flat
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Demand was high for firms with strong domestic markets, such as real estate.
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TOKYO, Japan (Reuters) -- Japan's Nikkei stock average ended flat on Monday, with investors shying away from high-tech issues on currency worries and ailing Kanebo Ltd plunging as it gave up on talks to sell its cosmetics division.
A drop in the tech-heavy Nasdaq late last week and concerns that monthly chip-making equipment orders data could disappoint later this week put pressure on semiconductor-related stocks with Advantest Corp a key loser.
But domestic demand-led issues like Japan's biggest property developer Mitsui Fudosan Co that have showed positive earnings developments were popular, also encouraged by hopes for strong gross domestic product (GDP) data due out on Wednesday.
After inching in and out of positive territory throughout the day, the Nikkei benchmark index closed down 0.08 percent or 8.97 points at 10,548.72. That followed an almost two percent rise in the previous two sessions.
The broader Topix index put on 0.38 percent to climb to 1,045.02.
In late afternoon trade, sources said Kanebo Ltd had abandoned plans to sell its cosmetics division to Japan's biggest household products maker, Kao Corp, and would instead seek the help of a government-backed rehabilitation body.
A potential Kao-Kanebo deal had been touted as one of the biggest full takeovers in Japan outside the financial sector.
"The market is not going to like this," said Yoshihisa Okamoto, senior vice president at Fuji Investment Management.
"Much depends on why this is happening but it does raise questions as to whether Kanebo can remain in business."
Kanebo tumbled hard, ending down 14.73 percent at 110 yen while Kao edged 0.22 percent lower to 2,295 yen.
Among chip-related stocks, Advantest was a major decliner, dropping 2.48 percent to 7,880 yen ahead of data for chip-making equipment orders in January due out later this week.
Tokyo Electron, another chip equipment maker, fell 2.03 percent to 6,770 yen.
"Chip data is one thing I'm going to be looking at. I'm keen to see if semiconductor stocks will be able to make a rebound," said Muneyuki Tsuji, fund manager at Japan Investment Trust Management Co Ltd.
One notable winner was KDDI Corp, Japan's second-largest telecoms carrier, which said it may spin off all or part of its fixed-line business in a move that could cut costs and allow it to focus on its rapidly growing wireless operations.
It rose 2.55 percent to 604,000 yen.
But much of the market focus remained in real estate and construction shares which are less sensitive to a rising yen against the dollar.
Mitsui Fudosan climbed 3.48 percent to 1,130 yen after Credit Suisse First Boston lifted its target price on the company, saying Mitsui Fudosan's planned extraordinary loss on writedowns on saleable real estate represented a major step forward in dealing with hidden losses.
Gainers outnumbered decliners 1,015 to 400 on the main board. A total 1.05 billion shares changed hands, compared with last week's daily average of 991 million shares.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
