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Nikkei falls, Chubu slide outweighs US payroll data

Published 05/08/2011, 09:31 PM
Updated 05/08/2011, 09:36 PM
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* Other utilities also hit by Chubu news

* Investors await earnings, Toyota reports this week

By Ayai Tomisawa

TOKYO, May 9 (Reuters) - Tokyo stocks fell on Monday as shares in Chubu Electric plunged after Japan's Prime Minister Naoto Kan called for the closure of its nuclear plant due worries that a large earthquake could trigger another nuclear crisis.

But while the utility sector dragged the market lower, analysts said general sentiment had improved from late last week after the U.S. April payrolls report unexpectedly showed an increase of 244,000 jobs, the most in 11 months. [ID:nOAT004799].

"Investors are getting past pessimistic sentiment on the U.S. economy, but trading may be thin today as investors want to see how major corporate earnings like Toyota's pan out this week," said Hiroichi Nishi, general manager at SMBC Nikko Securities.

The benchmark Nikkei fell 0.4 percent to 9,823.94, while the broader Topix dropped 0.2 percent to 854.57.

Chubu Electric is seeking a meeting with Prime Minister Naoto Kan and will likely heed Kan's legally non-binding request to close the Hamaoka plant if it can confirm government support for issues that will arise from a shutdown, Japanese media said.[ID:nL3E7G900P]

"This news is triggering uncertainty not just about Chubu Electric but the whole utility sector," said Yoshinori Nagano, a senior strategist at Daiwa Asset Management.

"Investors are concerned that on the back of this news other reactors currently under inspection may not resume operations soon."

Chubu tumbled 12 percent to 1,561 yen and some other utilities also fell with Kansai Electric dropping 2.9 percent to 1,665 yen. (Editing by Edwina Gibbs)

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