Nikkei down 1.5 pct, exporters sold on stronger yen
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TOKYO, June 3 (Reuters) - Japan's Nikkei average fell 1.5 percent on Tuesday, hurt by overnight losses on Wall Street and with exporters such as Honda Motor Co Ltd (7267.T) hit by a stronger yen.
Financial shares such as top lender Mitsubishi UFJ Financial Group (8306.T) fell after their U.S. peers tumbled on a credit ratings agency downgrade, raising new fears over the impact of the credit crunch.
"Forgotten problems were brought up again," said Fumiyuki Nakanishi, a group manager in the investment research department at SMBC Friend Securities.
The benchmark Nikkei .N225 ended the morning down 218.35 points at 14,221.79. The broader Topix index lost 1.2 percent to 1,408.33.
Honda fell 3.9 percent to 3,470 yen and high-tech device maker Kyocera Corp (6971.T) fell 2 percent to 9,920 yen, making them the biggest drags on the Nikkei.
Mitsubishi UFJ fell 1.2 percent to 1,116 yen following a tumble in U.S. financial stocks after Standard & Poor's downgraded debt ratings of three big securities companies.
Japanese bank stocks had booked hefty gains on Monday on expectations for earnings growth, and market participants said their fall was small compared with that of their U.S. peers.
"Japanese bank stocks showed resilience today. They used to suffer big falls when U.S. financials were sold," said Hiroaki Osakabe, a fund manager of Chibagin Asset Management.
"That has changed since May. A view has been spreading that Japanese banks are different from overseas rivals."
Mizuho Financial Group (8411.T), the nation's second-largest bank, edged down 0.2 percent to 590,000 yen by midday after managing to turn positive at times after losing as much as 2 percent immediately after the opening.
ENVIRONMENT STOCKS
In contrast with the broad sell-off, some stocks of firms in the fields of nuclear reactors and electric cars rose sharply.
Japan Steel Works Ltd (5631.T) rose 2.4 percent to 2,355 yen, up for the sixth straight day for cumulative gains of 17 percent.
The maker of nuclear reactor components and turbine-generator shafts has become a popular stock among investors who see a future in nuclear reactors for electricity generation amid growing concerns about global warming. Continued...
