Nikkei extends fall on Shiozaki comments, gets little help from China data

martes 21 de octubre de 2014 02:17 GYT

* Investors use minister's comments to book Monday's gains
    * China growth figures compound lingering global economic
    * Steel, machinery and shipping shares hit

 (Recasts, updates Nikkei level, market reaction)
    By Thomas Wilson
    TOKYO, Oct 21 (Reuters) - Japanese stocks fell on Tuesday,
with the market latching on to comments from the welfare
minister on the country's public pension fund as an excuse to
take profits from outsized gains the previous day.
    The Nikkei share index lost 2.0 percent, closing at
14,804.28 and erasing half of its 4.0 percent gains on Monday,
made on bets the Government Pension Investment Fund (GPIF) will
increase stock allocations sharply.
    Over the weekend, media reported that the $1.2 trillion GPIF
would likely raise its allocation for domestic stocks to about
25 percent, a bit more than market expectations of around 20
    Minister Yasuhisa Shizoaki, responsible for the GPIF, said
on Tuesday that he did not know anything about media reports,
disappointing investors who had hoped he might confirm such
    Amid lingering worries over global economic growth, the
market used Shiozaki's comments as an excuse to sell stocks. 
    "It certainly takes the shine off yesterday's 4 percent
rally, which was on the back of the GPIF reallocation headline"
said Gavin Parry, managing director of Parry International
Trading in Hong Kong.
    Adding to the sell-off in afternoon trade was data showing
that China's economic growth in the third quarter fell to near a
six-year low of 7.3 percent. [ID: nL3N0SF3SV]   
    Despite being slightly better than expectations, the Chinese
figures underscored the fragility of the global economy, and
reinforced expectations that Beijing would need to unveil more
stimulus measures to avert a sharper slowdown.
    Market players also cited concerns at the spectre of
deflation in the euro zone, uncertainty at the timing of the
Federal Reserve's tapering, and the possible effects of Ebola on
global trade as being a drag on growth.
    Japanese shares sensitive to fluctuations in the world's
second-biggest economy fell in reaction to the Chinese figures.
    Japan Steel Works Ltd lost 6.5 percent, while the
Tokyo Stock Exchange grouping of machinery shares 
shed 2.8 percent. Sea transport shares lost 1
    The yen appreciated slightly against the dollar,
rising to 106.37 yen, which hit exporters' shares. Toyota Motor
Corp shares lost 1.6 percent, while Honda Motor Co Ltd
 skidded 1.5 percent.    
    The broader Topix fell 1.6 percent to 1205.36, while
the new JPX-Nikkei Index 400 dropped 1.6 percent to

 (Reporting by Thomas Wilson; Editing by Alan Raybould and
Jacqueline Wong)