Reuters: Financial Services and Real Estate: Nikkei retreats from 1-year high on ex-dividend shares

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Nikkei retreats from 1-year high on ex-dividend shares Mar 28th 2012, 01:29 Tue Mar 27, 2012 9:29pm EDT * Majority of companies traded without the right of dividend * Sharp sees glut of buy orders after Hon Hai deal By Dominic Lau TOKYO, March 28 (Reuters) - Japan's Nikkei average fell in early trade on Wednesday after rallying 2.4 percent the previous day to its highest close since last year's massive earthquake, as a majority of the companies in the index went ex-dividend. The Nikkei was down 83.80 points, or 0.8 percent, at 10,171.35, as 195 out of 225 companies traded without the right of dividend, dealers said, who had expected the ex-dividend impact to take 86 points off the benchmark. Mizuho Financial Group slipped 2.8 percent and was the second-most heavily traded stock on the main board by turnover, as it carries the highest dividend yield on the benchmark Nikkei, data from Thomson Reuters Datastream showed. Takeda Pharmaceutical Co Ltd, which has the second-highest dividend yield among Nikkei companies, was the fifth-most heavily traded stock. Its shares fell 3.3 percent. Others that fell included NTT DoCoMo Inc, down 2.4 percent, and Sumitomo Mitsui Financial Group, losing 1.4 percent. Still, traders expected domestic passive funds would reinvest their dividends, which would push stocks higher. "Foreigners are buyers for the 12th straight week, so we are on pace there ... Overall the upward tag is still in place," said a senior dealer at a foreign bank. "The market is down because of ex-div ... We are still seeing better interest in buying auto stocks." Toyota Motor Corp added 0.1 percent. Wednesday's fall took the Nikkei's 14-day relative strength index to 68.5, after trading above 70, or 'overbought' territory for most of March and February. The Nikkei is still up more than 20 percent this year, buoyed by a run of strong U.S. economic data and accommodative monetary policies by global central banks. The broader Topix index dropped 0.9 percent to 864.78. SHARP IN SPOTLIGHT Sharp was untraded with a glut of buy orders after saying it will issue shares worth $808 million to Taiwan's Hon Hai Precision Industry as part of a tie-up in liquid crystal display production. Sharp was notionally quoted at 570 yen, up 15.2 percent from Tuesday's close of 495 yen. Toppan Printing Co Ltd jumped 5.8 percent and Dai Nippon Printing Co Ltd climbed 2.5 percent as the two companies supplied colour filters to Sharp. Sony Corp advanced 2.2 percent after its CEO Kazuo Hirai signalled his determination to turn around the group's ailing TV business by keeping direct charge of the division, as the Japanese brand fights to regain ground against rivals such as Apple. Link this Share this Digg this Email Reprints

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