Tokyo stocks plunge

Tokyo stocks tumbled 3.30 percent on Friday, following sharp falls on Wall Street and a rise in the yen as investors fret about the Ukraine crisis and China's economy. The benchmark Nikkei-225 index lost 488.32 points to 14,327.66, while the Topix index of all first-section shares fell 3.22 percent, or 38.76 points, to 1,164.70. Tokyo's early losses accelerated after the break as traders moved into the safety of yen as weak Chinese data and rising tensions in Ukraine fan concerns about the global economy.
The dollar slumped to 101.55 yen in Friday afternoon, well below 102.73 yen in Tokyo on Thursday, hammering exporters. Wall Street provided a negative lead, with the three main US indexes all tumbling despite solid US retail sales and labour-market data.
"Japan stocks take the first hit on bad Asian news, then when the US markets fall late, they react to that as well, resulting in a 'double whammy' effect," a Tokyo-based hedge fund manager told Dow Jones Newswires. "Japan shares are cheap, but it's not about valuations; it's about risk, and investors are now firmly back in 'risk-off' mode now," said SMBC Nikko Securities general manager of equities Hiroichi Nishi.
China on Thursday released another set of poor indicators, just days after announcing a surprise trade deficit and slump in exports that have fuelled fears of a slowdown in the economic powerhouse and key driver of global growth. The top diplomats of the US and Russia are due to meet in London to try to defuse the crisis over Ukraine with Moscow warned of a serious backlash over a referendum in Crimea on becoming part of Russia, a vote the West has called illegal.
Kenichi Hirano, market analyst at Tachibana Securities, said "the dearth of participants is showing what happens when there is nobody home to catch a falling knife." Toshiba tumbled 3.94 percent to 438 yen after news that the firm sued South Korean chipmaker SK Hynix, claiming it had stolen trade secrets through a Japanese engineer. Sony dived 4.24 percent to 1,761 yen and Honda closed down 3.06 percent at 3,607 yen. IHI fell 6.99 percent to 439 yen and Mitsubishi Heavy lost 4.21 percent to 591 yen despite a report in the Yomiuri newspaper that the two firms plan a tie-up in their aircraft engine businesses.