Nikkei slides 2.5 pct on European debt worries

* Nikkei falls below 25-day MA around 11,100

* Exporters hit on fears Greek credit problems could spread

* Toray rises on plan to make carbon fibre car parts

By Rika Otsuka

TOKYO, April 28 (BestGrowthStock) – Japan’s Nikkei average slid 2.5
percent on Wednesday, with exporters taking a beating after
downgrades of Greece and Portugal’s credit ratings sparked fears
the euro zone’s debt problems were spreading.

Shares of blue-chip exporters including Canon Inc (7751.T: )
dropped after rating agency Standard and Poor’s slashed Greet
debt to junk status on Tuesday and also downgraded Portugal,
fuelling concerns about the euro zone economic stability.
[ID:nLDE63P0LU]

The Nikkei fell below its 25-day moving average, now around
11,100, also hurt as investors took profits on shares like
industrial robot maker Fanuc Ltd (6954.T: ) which had rallied on
better-than-expected profits or earnings guidance.

“The biggest factor behind today’s fall is worries that
credit problems could spread to other parts of Europe,” said
Masayoshi Yano, a senior market analyst at Meiwa Securities.

“Investors now fear that credit woes which started in Greece
could slow down the whole European economy.”

The benchmark Nikkei (.N225: ) dropped 276.67 points to
10,935.99, while the broader Topix (.TOPX: ) fell 2 percent to
977.59.

The slide in Tokyo stocks follows a tumble for U.S. shares
which posted their worst day in nearly three months on Tuesday
following downgrades of Greece and Portugal, and as a grilling of
Goldman Sachs on Capitol Hill heightened the possibility of
financial reform. [.N]

Analysts said the Nikkei is expected to find near-term
support at 10,800, roughly a 38.2 percent retracement of a
two-month rally that started in early February and pushed the
Nikkei up to an 18-month peak of 11,408.17 in early April.

“The Nikkei is not expected to fall below 10,000 in the
mid-term as many Japanese firms are reporting solid earnings
figures, although the market may succumb to more profit-taking,”
Meiwa’s Yano said.

Honda Motor skidded 1.8 percent to 3,275 yen and Canon Inc
lost 2.5 percent to 4,275 yen.

Among firms that saw heavy profit-taking after rallies,
Fanuc Ltd (6954.T: ) shed 4.2 percent to 11,180 yen to become the
most actively traded stock by turnover on the main board, while
copier and printer maker Konica Minolta Holding (4902.T: ) lost 3.8
percent to 1,207 yen.

Mazda Motor Corp (7261.T: ), Japan’s No.5 automaker, fell 2.9
percent to 273 yen after its earnings forecast fell short of
market expectations. [ID:nTOE63Q07J]

But Toray Industries (3402.T: ) rose 2 percent to 555 yen after
the textile maker said it and German carmaker Daimler AG
(DAIGn.DE: ) will jointly develop carbon fibre car parts.

Canon fell 2.5 percent to 4,275 yen.

Stock Market Investing

(Reporting by Rika Otsuka; Editing by Edwina Gibbs)

Nikkei slides 2.5 pct on European debt worries