Japan’s Nikkei sinks 12.4% in worst losses since 1987

Sheds 4,451.28 points amid heavy selling triggered by worries that US economy may be in worse shape than expected

Tokyo: Japan’s Nikkei 225 share index plunged more than 12 per cent on Monday as investors, worried that the US economy may be in worse shape than had been expected, dumped a wide range of shares.

The Nikkei index shed 4,451.28 to 31,458.42. It dropped 5.8 per cent on Friday and has now logged its worst two-day decline ever, dropping 18.2 per cent in the last two trading sessions.

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At its lowest the Nikkei plunged as much as 13.4 per cent. Its biggest single-day rout was a drop of 3,836 points, or 14.9 per cent, on the day dubbed “Black Monday” in October 1987.

It suffered an 11.4 per cent drop in October 2008 during the global financial crisis and fell 10.6 per cent during the aftermath of massive earthquakes and nuclear meltdowns in northeastern Japan in March 2011.

Share prices have fallen in Tokyo since the Bank of Japan raised its benchmark interest rate on Wednesday. The benchmark is now about 3.8 per cent below the level it was at a year ago.

The wave of selling hit all sorts of companies.

Toyota Motor Corp.’s shares dropped 11 per cent and Honda Motor Co. lost 13.4 per cent. Computer chip maker Tokyo Electron dived 15.8 per cent and Mitsubishi UFJ Financial Group plunged 18.4 per cent.