Ja­pan cri­sis sends Aust shares to 14- week low Fear bat­ters mar­ket

Townsville Bulletin - - Investor -

AUS­TRALIAN shares closed at a 14-week low as fears of a nu­clear catas­tro­phe i n Ja­pan bat­tered in­vestor con­fi­dence.

The Aus­tralian bourse man­aged to claw back some of its ear­lier losses af­ter the Bank of Ja­pan ( BoJ) in­jected $ 181 bil­lion into that coun­try’s money mar­kets to keep the econ­omy mov­ing fol­low­ing the dev­as­tat­ing tsunami trig­gered by a mas­sive earth­quake on Fri­day.

The bench mark S&P / ASX200 in­dex was down 18.4 points, or 0.4 per cent, at 4 6 2 6 . 4 points while the broader All Or­di­nar­ies in­dex re­treated 24.7 points, or 0.52 per cent, to 4,710.1 points – its low­est fin­ish since De­cem­ber 6 last year.

IG Mar­kets mar­ket strate­gist Ben Pot­ter said Asian bourses were all lower, with Ja­pan’s Nikkei 225 un­sur­pris­ingly plung­ing 5.8 per cent ahead of a Bank of Ja­pan ( BoJ) meet­ing later in the day when it kept its key rate un­changed at be­tween zero and 0.1 per cent.

‘‘ Spec­u­la­tion sug­gests the BoJ will in­ter­vene and try to weaken the yen ma­te­ri­ally,’’ Mr Pot­ter said.

The Ja­panese cen­tral bank also said it would in­crease its

CAU­TION: Tokyo shares plunged al­most six per cent yes­ter­day as in­vestors re­acted to the big­gest earth­quake in Ja­pan’s his­tory as­set pur­chase scheme by around 5 tril­lion yen ($ A59.28 bil­lion) to 40 tril­lion yen ($ A474.21 bil­lion) in an ef­fort to in­ject liq­uid­ity into the fi­nan­cial sys­tem.

Mr Pot­ter said traders had been solely fo­cused on news from Ja­pan. Pre­lim­i­nary es­ti­mates put re­pair costs from the disas­ter in the tens of bil­lions of dol­lars – a huge blow to the al­ready frag­ile Ja­panese econ­omy – while the death toll is climb­ing be­yond 2000 amid ex­pec­ta­tions it could reach tens of thou­sands.

Mr Pot­ter said the weight of un­cer­tainty on in­vestor con­fi­dence and sen­ti­ment meant it would be dif­fi­cult for the lo­cal mar­ket to re­cover some of its re­cently lost ground.

The do­mes­tic bourse has been down five out of the past six ses­sions.

Mr Pot­ter said the bulk of the sec­tors were firmly in the red, with the en­ergy, ma­te­rial and fi­nan­cial sec­tors do­ing the most dam­age.

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