Nikkei: Worst year ever with a loss of 42%

What a difference 20 years makes.

The Japanese stock market on Tuesday morning completed its investment year with its usual half-day, Dec. 30 session. That won it the dubious honor of being the first major global stock market to put its 2008 performance in the books — and its double-digit loss is likely to be followed by most of the rest of the world.

The Nikkei Stock Average’s glory days above 38000 are a distant memory, as the Japanese stock market has completed its dismal 2008 investment year. Pictured, a trader in Tokyo earlier this month. Associated Press

The Nikkei closed up 1.3% to finish at 8859.56, booking its worst year ever with a loss of 42%. This follows an 11.1% decline for 2007. On a positive note, the index marked its first positive month since May.

More striking is the Nikkei’s comedown from its heights two decades ago. In 1989, on the last trading day of that year, Tokyo’s blue-chip index had touched an all-time high of 38915.86.

On Monday, the final full trading session of the year, the Nikkei had closed at 8747.17, down 7.65 points or 0.09%.

Insurance stocks in Tokyo on Monday surged in the wake of reports that Mitsui Sumitomo Insurance Group, Aioi Insurance and Nissay Dowa General Insurance were in talks to integrate their operations by next autumn.

In a statement posted on its Web site, Mitsui Sumitomo wrote that “no decision that needs to be disclosed has been made.” Mitsui Sumitomo rose 8.3%, Aioi soared 19% and Nissay Dowa jumped 15%.

Meanwhile, European stocks rose Monday. Returning from a long Christmas break, major European stock indexes climbed in thin trading, though the pan-European Dow Jones Stoxx 600 index edged down.

The main European markets were closed Thursday and Friday last week, with the German market also closed on Wednesday. Markets will be closed Thursday this week for New Year’s Day.

In LONDON, the U.K. FTSE 100 index rose 2.4% to 4319.35. Some oil shares rose as crude prices initially shot up Monday, though oil gave back much of its gains by midafternoon in New York. BP ended 3.7% higher.

The Dow Jones Stoxx 600 slipped 0.2% to 193.46.

In FRANKFURT, shares of truck maker Man rose 6.3% after the company said it has bought call options on shares in Swedish truck maker Scania, a move that gives it access to more than 20% of Scania’s share capital. Scania rose 8% in Stockholm. The German DAX 30 index climbed 1.6% to 4704.86.

Meanwhile, most Asian markets, aside from Tokyo’s, ended higher Monday amid light trading volumes and high volatility.

In SHANGHAI, stocks fell for a sixth session in a row on worries about earnings growth and the deteriorating economic situation. The Shanghai Composite Index fell 0.1% to 1850.48.

In MUMBAI, the Bombay Stock Exchange’s Sensitive Index gained 2.2% to 9533.52. Satyam Computer Services ended 9.4% higher after the software company said it was rescheduling its next board meeting to consider its options after canceling plans to buy two infrastructure firms. The board meeting is now set for Jan. 10.

In SINGAPORE, the Straits Times Index advanced 3.2% to 1780.57. Property shares led the gains, with CapitaMall Trust surging nearly 88%. Keppel Land ended 3.7% higher and CapitaLand rose 1.7%. The Singapore Exchange questioned the surge in CapitaMall Trust’s unit price. CapitaMall, a real-estate investment trust, on Tuesday in Singapore said that it isn’t aware of reasons behind the substantial jump in the prices of its units.

Meanwhile, in MEXICO CITY, stocks closed lower for the first time in four sessions Monday, led by declines in shares of mobile operator America Movil. The market’s IPC index fell nearly 0.6%, or 122.96 points, to close at 22392.38.

DECEMBER 30, 2008

Source: The Wall Street Journal

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