Shares in Toyota and Honda fell on the Tokyo stock exchange after official US retail sales showed the biggest drop in three years, fuelling concerns an economic slump may deepen.
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Bloomberg News said Toyota dropped JPY340, or 9%, to close at JPY3,310 while Honda slid 10% to JPY 2,115 and Nissan Motor was off 11%, the most in seven years, to JPY475 yen.
Other Japanese media reports said global stocks had fallen on Thursday with the Tokyo exchange closing down more than 11% after a Wednesday plunge in New York as the data about the US economy – worse than expected – boosted fears of global recession.
Japanese prime minister Taro Aso was reported to have blamed the renewed drop in share values, after a rebound earlier this week, on investor concerns that the US government’s US$700bn bank bail-out was insufficient.
The 1,089.02 points, or 11.41%, slide in the Nikkei 225 stock average to 8,458.45 was its biggest drop since the 1987 crash, the reports added.
US Commerce Department data showed purchases at US retailers fell 1.2%, Bloomberg said. It added that JD Power had forecast that vehicle sales in the country, where Japan’s three largest carmakers earn at least half of their operating profit, could plunge to their lowest level in 15 years.
“It may be tough for the US market to reach 14m vehicles this year,” Japan Automobile Manufacturers Association – and Honda Motor chairman – Satoshi Aoki told a press conference in Tokyo. “The US should carry out steps to restore financial functions,” he added.
Edmunds.com industry analyst Jesse Toprak told Bloomberg US new car sales in October, traditionally the weakest month of the year, may decline as much as 20% month on month.
We are beyond the seasonal drop,” he told the news agency. “Uncertainty is causing a great depression in consumer confidence.”
