STOCK MARKET WATCH -- Tuesday, 4 February 2014

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33. Japan Sees Worst Developed-Stock Rout as Nikkei 225 Drops

http://www.bloomberg.com/news/2014-02-03/japan-sees-worst-developed-stock-rout-as-nikkei-225-drops.html

What a difference a year makes.

At the end of January 2013, Japanese stocks trailed only Portugal for the biggest rally among developed markets. Now the Nikkei 225 Stock Average is leading declines, slumping 8.5 percent last month and today capping a 14 percent drop from its Dec. 30 peak.

Losses snowballed in Tokyo during a global retreat that has erased $2.9 trillion from equity values worldwide this year amid signs of slower growth in China and stimulus cuts by the U.S. Federal Reserve. The yen, down 18 percent in 2013, halted its slide and started to strengthen, potentially curbing company profits, says Coutts & Co. A sales tax increase for April will damp consumer spending, according to Sumitomo Mitsui Asset Management Co.

“Japan’s market finally came to its senses,” said Tetsuo Seshimo, a portfolio manager at Saison Asset Management Co, which oversees about 79 billion yen ($778 million). “Investors ignored risk too much toward the end of last year and the market was out of balance.”