Nikkei set for sharp drop below key support
TOKYO, June 30 (Reuters) - Japan's Nikkei average is set for a sharp drop on Wednesday, after a tumble on Wall Street, with the benchmark index seen breaking below a key support level, which market players say will ignite more falls.
Nikkei futures traded in Chicago 2NKc1 closed at 9,375, down 1.8 percent from the Osaka close JNIc1.
Charts have turned bleaker, with the Nikkei's MACD set for a bearish cross and its slow stochastic, which gives near-term signals on market trends, edging down in oversold territory.
The Nikkei ended the previous day at 9,570.67, and its next targets stand just below 9,400, a six-month low hit this month, and then 9,250 and 9,000, one market analyst said.
For the quarter ending Wednesday, the Nikkei is poised for its worst quarter since Lehman Brothers failed in 2008.
"Europe's finance and debt problems have come to the fore, and there's a growing concern that Europe's confusion might actually negatively impact the global economy going forward," said Kenichi Hirano, operating officer at Tachibana Securities.
"But I don't expect to see a panic in the market, because if not as if investors had been overly optimistic and there was a landslide all of the sudden. They had been already vigilant."
The benchmark Nikkei .N225 is likely to move between 9,300 and 9,500, market players said. It slipped 1.3 percent on Tuesday to its lowest close in two weeks.
On Tuesday, the S&P 500 tumbled to its lowest level in eight months in a sell-off triggered by a wave of increasing alarm over the global economic outlook, including escalating doubts about the stability of Europe's banks. [.N]
The benchmark Nikkei is on course to to book its worst quarter since October-December 2008 as European debt worries pushed investors to curb their willingness to bet on risky assets, including equities.
For the quarter ending Wednesday, the index has shed nearly 14 percent so far, compared with a 21 percent drop in the quarter that finished in December 2008, following the collapse of Lehman Brothers. ----------------------MARKET SNAPSHOT @ 2316 GMT ------------
INSTRUMENT LAST PCT CHG NET CHG S&P 500 .SPX 1041.24 -3.1% -33.330 USD/JPY JPY= 88.65 0.18% 0.160 10-YR US TSY YLD US10YT=RR 2.9527 -- 0.000 SPOT GOLD XAU= 1241.1 0.25% 3.100 US CRUDE CLc1 75.49 -0.59% -0.450 DOW JONES .DJI 9870.30 -2.65% -268.22 ------------------------------------------------------------- > Wall St sinks as economic alarm escalates [.N] > Euro slides; dollar, yen rally on recovery fears [USD/] > Strong bid for U.S. debt as stocks tumble [US/] > Gold rebounds as equities, commodities sell off [GOL/] > U.S. crude pares losses after big API stock draw [O/R]
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The rosuvastatin patent was originally obtained by Japan's Shionogi, the Japanese company that invented the Crestor drug and licensed it to AstraZeneca in 1998. [ID:nN29171153]
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