Nikkei down 0.6 percent

The Nikkei average shed 0.57 percent on Friday as investors hit by a slump in small-cap stocks booked profits in recent gainers in the index, including steel shares such as Nippon Steel Corp.
Sumitomo Metal Mining Co Ltd and other base metals smelters slid after copper prices tumbled 5 percent on growing concerns about future demand from top buyer China, making the non-ferrous metals sector Infra major loser among the Topic's 33 industry sub-indexes
Mitsumi Electric Co Ltd, which makes electronics parts for game consoles such as for Nintendo Co Ltd's Wii, became the largest drag on the Nikkei after it projected lower-than-expected profit growth for the year to next March.
"As small-cap shares keep sliding, retail investors are accelerating sales of large-cap shares such as steel and property stocks to cover losses from their investment in the small-cap market," said Hiroyuki Fukunaga, chief strategist at Rakuten Securities.
The Mothers index of start-up stocks was down 1.87 percent at 813.18, after earlier setting a lifetime low for the fifth straight session. The Nikkei Jasdaq average, which lists small- to medium-cap shares, ended down 0.59 percent at 2002.36 after hitting its lowest since August 2005.
Fukunaga blamed the slide on poor earnings reports from companies listed on the markets, saying it is hard to find factors that could reverse the markets' downtrend.
The Nikkei closed down 99.02 points at 17,399.58, its lowest close since May 2. On the week, the index lost 0.88 percent. The broad TOPIX index fell 0.68 percent to 1,695.69. Mitsushige Akin, chief fund manager at Ichiyoshi Investment Management, said the Nikkei was under pressure from selling by Japanese pension funds and other institutional investors.
"There are no major buyers in the market," he said. "Mutual funds are net sellers of Japanese stocks, as money from individuals are shifting to funds with focus on foreign assets." Foreign investors, who led a rally in the Nikkei earlier this year, are also losing interest in Japanese stocks due to cautious profit outlooks from Japanese companies and weak economic data.
"Them to return to the Japanese market, fresh positive incentives, such as strong earnings for the first quarter of the current business year, are needed," Akin said.
But the downside in the Nikkei looks limited, as its estimated price-earnings ratio is about 19 times, the level that tends to stimulate bargain hunting from investors, he said. Mitsumi Electric lost 6.8 percent to 3,680 yen. Mitsumi, the maker of the Wii's trademark motion-detection remote controller, said its operating profit grew five-fold to 26.71 billion yen ($220.2 million) in the year ended in March thanks to strong sales of game and mobile phone parts, but projected just 3 percent growth for this year.
Credit Saison Co Ltd was another major drag on the Nikkei, falling 4.3 percent to 3,350 yen. The card company forecast on Thursday smaller-than-expected earnings due to lowering the maximum rates it charges.
Sumitomo Metal mining shed 4.1 percent to 2,725 yen, hit by a 5 percent fall in copper prices on the London Metal Exchange on Thursday. Among major gainers, INPEX Holdings Inc rose nearly 3 percent after London Brent crude topped $70 a barrel to an 8-month high on Thursday, raising expectations among investors for higher profits of the Japanese oil explorer.
After the close, Nippon Oil Corp, Japan's biggest oil refiner, said it and trading firm Mitsubishi Corp have bought a total 23.2 percent stake in the K2 oil field in the Gulf of Mexico from Anadarko Petroleum Corp of the United States for $1.2 billion.
Real estate investment advisor KK deviance Advisors said it would go ahead with a planned a tender offer for building leasing firm TOC Co, a week after Toc's own tender offer failed.
Takeda Pharmaceutical Co Ltd said it would buy back up to 75 billion yen ($618 million) worth of its own shares. Trade slowed, with 1.97 billion shares changing hands on the Tokyo exchange's first section, compared with 2.03 billion the previous session. Declining shares beat advancers by a ratio of more than four to one.