Nikkei set for sharp fall on U.S. jobs data, euro woes

TOKYO (BestGrowthStock) – Japan’s Nikkei average may fall sharply on Monday after disappointing U.S. jobs data further spooked investors already worried about a potential debt crisis in Hungary, sending Wall Street to its lowest close since February.

Nikkei futures traded in Chicago closed at 9,615, down 3.2 percent from the Osaka close.

Worries that Europe’s sovereign debt troubles could spread reignited after a Hungarian official said the country was at risk of a Greek-style crisis, driving the euro to a more than four-year-low against the dollar.

“Once more there are worries about European debt, the U.S. job data disappointed, and the yen is strengthening,” said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

Data showed the U.S. economy added 432,000 jobs last month, far fewer than the expected 513,000, with a large portion of those being temporary hirings for the U.S. census.

But it was the fifth monthly increase in employment and the unemployment rate dropped to 9.7 percent from 9.9 percent.

“There’s no question that the U.S. economy is recovering, but there are still patches of weakness. That’s what the jobs data showed,” Nishi added.

The euro fell (Read more about the trembling euro. ) 0.5 percent against the yen to 109.18 yen while the dollar lost 0.3 percent against the yen to 91.53 yen. Investors fret about a stronger yen because it eats into exporter profits when repatriated.

Investors will also keep an eye on politics and policy as Naoto Kan, Japan’s new leader, finalizes his cabinet. Kan has chosen fellow fiscal conservative Yoshihiko Noda, currently deputy finance minister, for the top finance portfolio.

Support for the Democrats has jumped since the it voted in Kan on Friday to replace Yukio Hatoyama, who quit as premier after just eight months in office, his ratings shredded by indecision and broken promises.

Market players said the Nikkei was likely to move from 9,550 to 9,750 on Monday. It closed at 9,901.19 on Friday.

The Nikkei’s relative strength index (RSI) rose to 42, its highest in a month, on Friday, while its MACD was sharply higher after a bullish cross.

Wall St hit by U.S. jobs data, European worries.

Euro slides below $1.20 on Hungary debt fears.

Safety bid spurs rally as stocks, euro tumble.

Gold rises, rebounds from slump in safe-haven bid.

Oil falls 4 pct as US jobs data hits markets.

STOCKS TO WATCH

— Eisai Corp

An experimental breast cancer drug made by Eisai from sea sponges, eribulin, added months to the lives of breast cancer patients whose cancer had come back despite several rounds of therapy, U.S. doctors reported on Sunday.

— Honda Motor

Honda said on Friday it settled a labor dispute at a Chinese car parts plant after almost three weeks of on-and-off disruption, allowing it to build cars again in the world’s fastest-growing market.

— Hitachi Zosen Corp

Hitachi Zosen and Finnish engine maker Wartsila (WRT1v.HE: ) will start developing fuel cells for manufacturers and other business users looking to reduce their carbon dioxide emissions, the Nikkei business daily reported.

The two firms already cooperate on engines for ships and power generation.

— Mitsubishi Corp (8058.T: ), other trading houses

Copper on Friday hit its lowest price since October 2009, with other base metals also falling to multi-month lows as worry about global economic recovery flared again.

Investment Analysis

(Reporting by Elaine Lies; Editing by Edwina Gibbs)

Nikkei set for sharp fall on U.S. jobs data, euro woes