Nikkei Slips As Property Firms Down; Techs Gain

The Nikkei share average slipped 0.56 percent.

The Nikkei share average slipped 0.56 percent on Monday as Sumitomo Realty & Development Co. Ltd. and other property firms were hit by concerns about higher interest rates at home and worries about the U.S. subprime mortgage market.

Shares of chip-equipment firm Advantest Corp. and other exporters helped stem the losses, rising as the yen remained near its lowest in 4-½ years against the dollar.

Property companies, which are sensitive to higher borrowing costs, were sold on expectations the Bank of Japan is likely to raise rates in August.

Investors were also wary after two Bear Stearns hedge funds were hit by steep losses on subprime mortgage bonds.

"I think global investors are lowering their weighting of property stocks, including (real estate investment trusts), worldwide. Along with that, Japanese property stocks are being sold," said Soichiro Monji, chief strategist at the equity management department of Daiwa SB Investments. "Concerns about the American real estate market are likely weighing on sentiment, but in reality these stocks are being sold because of (expectations of) higher rates," Monji said.

The Nikkei finished down 101.15 points at 18,087.48.

The broader TOPIX index fell 0.74 percent to 1,764.87.

Real estate developer Sumitomo Realty fell 3.9 percent to 4,000 yen, becoming the single biggest contributor to the Nikkei's decline.

Mitsui Fudosan Co. Ltd., Japan's largest realty developer, declined 2.8 percent to 3,430 yen. Second-ranked Mitsubishi Estate Co. Ltd. fell 2.4 percent to 3,330 yen.

But chip-equipment maker Advantest and other exporters rose on expectations of higher profits after the yen remained near a 4-½ year low to the dollar.

A weak yen is a boon for companies that make the bulk of their sales abroad, as it boosts profits when earnings from abroad are brought home.

Advantest, which makes nearly 70 percent of its sales overseas, rose 1.1 percent to 5,550 yen.

Industrial robot maker Fanuc Ltd., which makes nearly 65 percent of its sales outside of Japan, gained 1.4 percent to 12,960 yen.