Japan's Nikkei stock average posted its biggest loss in two months on Thursday, tumbling 1.95 percent as shares fell across the board on concern that recent advances had overheated prices.
A mistaken sell order for a huge block of shares in recruitment firm J-Com Co Ltd during its first day of trade on the Tokyo Stock Exchange's market for start-ups helped steepen the overall market's fall, analysts said.
After the close of trade, the securities unit of Mizuho Financial Group Inc said it was responsible for the error.
"The market was starting to get a little bubbly, so for it to get pierced by Mizuho will be good to cool things down," said Hiroyuki Nakai, chief strategist at Tokai Tokyo Securities.
"It was getting to the point where you were wondering how far this thing would go. I think this is good medicine."
Weaker machinery orders than expected for October also weighed on market sentiment, analysts said.
The Nikkei finished the day down 301.30 points at 15,183.36, its biggest one-day loss since October 6. It hit a five-year closing high of 15,551.31 on Monday.
The broader TOPIX index lost 1.87 percent to 1,568.73.
Analysts said the mistaken order to sell 600,000 shares of recruitment firm J-Com - more than 41 times its amount of outstanding stock - heightened concern that a brokerage could suffer a major loss.
The securities sector fell 3.5 percent, becoming the second-biggest loser among the TOPIX's 33 industry sub-indexes.
Nomura Holdings Inc, Japan's largest brokerage, fell 3.7 percent to 2,085 yen, and second-ranked Daiwa Securities Group Inc lost 3.3 percent to 1,221.
"Word of the mistaken order offered a good opportunity for profit-taking," said Kazuyuki Naito, general manager of equities sales at Mitsubishi UFJ Securities.
Banks fell due to concern about their recent aggressive gains. Mitsubishi UFJ Financial Group Inc, the world's largest bank by assets, gave up 3.1 percent to 1.58 million yen.
Mizuho Financial finished down 3.4 percent at 890,000 before its securities unit said it was responsible for the J-Com order error.
Shares in Japan's second-largest bank had surged to a lifetime high in the previous session.
Japan's core machinery orders rose a seasonally adjusted 4.8 percent from September, below a forecast gain of 5.9 percent.
Fanuc Ltd, a maker of industrial robots, lost 1.6 percent to 9,870 yen. Ishikawajima-Harima Heavy Industries Co Ltd, a maker of heavy electric machinery, fell 3.9 percent to 322 yen.
Takashimaya Co Ltd, a major department store, lost 6.9 percent to 1,867 yen after Deutsche Securities downgraded the stock to "sell" from "hold", saying its recent rally was overstretched.
Trading was slow, with 2.5 billion shares changing hands on the Tokyo exchange's first section, the lowest since November 30. Decliners outpaced gainers 1,354 to 257.
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