Japan‘s Nikkei 225 stock average fell on Monday at its fastest pace since the Livedoor shock in January, hit by a drop in the dollar against the yen and by fears over higher oil prices.

The Nikkei 225 plunged 2.8 per cent to 16,914.40. The Topix fell 2.6 per cent to 1,710.76.

The dollar fell to a three-month low against yen, hitting exporters with high exposure to the US market.

However, many exporters performed no worse than the market as a whole – with many domestic stocks falling by as much.

Analysts said stocks across the board were hit by fears that high oil prices might damage the new year’s corporate earnings.

Transport equipment, one of the sectors most sensitive to foreign exchange fluctuations because of its heavy reliance on exports to the US, dropped 2.7 per cent. Toyota, Japan’s biggest carmaker, was down 2.8 per cent to Y6,710.

Electrical machinery, another highly export-sensitive sector, fell 2.5 per cent. Hitachi, the electronics conglomerate, was down 4.2 per cent to Y841. Sharp, the consumer electronics and LCD maker, slid 2.4 per cent to Y2,015. Sony, the consumer electronics and entertainment giant, was down 2.9 per cent to Y5,970.

NEC, the consumer electronics giant, declined 4.5 per cent to Y834 after warning on lower profits.

Consumer finance companies took another big hit on Monday morning, continuing to fall sharply following the news that a Financial Services Agency panel had proposed a cut in the maximum legal rate of interest.

Takefuji declined 2.5 per cent to Y7,030. Credit Saison fell 4.4 per cent to Y5,670. But the biggest loser was OMC Card, which plunged 11.3 per cent to Y1,690 after Alpha OMC, a subsidiary, was ordered to suspend operations at its debt collection management centre as punishment for violations of money lending rules.

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