Nikkei slips toward worst weekly losing run in 20 years
* Nikkei falls 0.7 pct on weak U.S., China data * Topix set for longest weekly losing streak since 1975 * Exporters sink; yen hits 11-1/2 yr high against euro By Sophie Knight TOKYO, June 1 (Reuters) - Japan's Nikkei average slipped on Friday morning, heading for a ninth straight week of losses to match its longest such run in 20 years, after disappointing Chinese and U.S. data compounded fears about the deepening euro zone debt crisis. Concern about slowing growth in the world's two biggest economies and the possibility of the euro zone's collapse kept the yen firm against the dollar and sent it rocketing to an 11-1/2 year high against the euro, weighing on exporters who already face weakening demand for their products. Canon Inc, Mazda Motor Corp, Nissan Motor Co and Sony Corp lost between 2 and 4 percent. The Nikkei slipped 0.7 percent to 8,479.12. "The problem is that although Japanese stocks are technically cheap according to past barometers, the market has always moved more on foreign factors than domestic ones," said Yutaka Miura, senior technical analyst at Mizuho Securities. "So the falls today are a reaction to poor U.S. data last night." U.S. jobless claims rose for the seventh week in eight, putting investors on edge before Friday's monthly nonfarm payrolls report, while factory activity in the U.S. Midwest slowed considerably this month and economic growth in the first quarter was softer than anticipated. Economists in a Reuters poll estimated that 150,000 jobs were created in May, compared with 115,000 in April, with the unemployment rate expected to remain at 8.1 percent. China announced on Friday its official purchasing managers' index (PMI) fell to 50.4 in May, the weakest this year and down from April's 13-month high, indicating that output is continuing to cool in the world's second-largest economy. Investors sought refuge in defensives, with telecoms firms benefiting. KDDI Corp gained 2.4 percent and Softbank Corp added 1.6 percent. NTT DoCoMo put on 3.5 percent, also boosted by an extended report in the Nikkei business daily on Thursday about its tie-up with Amazon Japan to sell prepaid internet access for smartphones and tablet computers, first reported on Monday. The Nikkei shed 1.1 percent on Thursday to log its worst monthly fall in two years. It was deep in "oversold" territory, with its 14-day relative strength index at 28.2. The index is down 1.2 percent this week, and has fallen 17.3 percent since hitting a one-year high on March 27 on concerns about Europe and a slowdown in growth in the United States and China. "Many investors are watching the timing to enter the market. However, as long as the knife is falling, nobody can catch it," said Ryota Sakagami, chief strategist in equity research at SMBC Nikko Securities. "The current problem is the tail risk from Europe ... However, (it's) different from last year," he said, adding that the U.S. economy was in better shape, but that investors had high expectations for its performance. The broader Topix lost 1 percent to 712.68. The index is down 1.3 percent this week, on track for a ninth straight week of losses to mark its worst weekly losing streak since 1975. The sell-off has taken the Topix's 12-month forward price-to-earnings ratio to 10.9, a level not seen since November 2008, data from Thomson Reuters Datastream showed.
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