Tokyo shares close morning lower

Share prices ended the morning weaker on balance following overnight falls on Wall Street, where investor confidence has been knocked by news of accounting irregularities at US companies, dealers said.

Worldcom lost some 90% of its value overnight after trading in the stock resumed for the first time since the company announced a $3.8bn (€3.86bn) restatement of its 2001 and first quarter 2002 earnings last Wednesday.

The Nikkei 225 index closed the morning down 202.89 points, or 1.91%, at 10,392.55, off a low of 10,371.26.

Volume was estimated at 288 million shares.

The Topix index was down 15.12 points at 1,013.51 and the Nikkei 300 index off 3.15 points at 199.19.

Decliners led gainers 974 to 340, with 160 stocks unchanged.

The Nikkei September contract was down 200 points at 10,400 on the Osaka Securities Exchange.

Tokyo Mitsubishi Personal Securities head of equities Hidenori Karaki said investors were also concerned about the threat of possible terrorist attacks in the US ahead of the Independence Day holiday on July 4.

"Because of such talk, people have virtually no interest in building fresh positions right now," he said.

Also of concern to investors is Wall Street's uncertain outlook.

"While NASDAQ has already fallen to levels where it stood some five years ago, the DJIA index, which has been comparatively solid, also looks to be on the verge of further collapse," Karaki added.

Investors are also turning cautious ahead of the start later this month of a quarterly reporting season in Japan, dealers said.

Firms such as Sony and Matsushita Electric are expected to report their first quarter to June earnings before the end of this month.

Signs of economic improvement at home are providing some support for the market, dealers said.

"Unless recovery hopes fully disappear, investors are likely to place some buy orders for bargain-hunting below the 10,000 point level on the Nikkei 225 index," Karaki said.

Microchip stocks closed the morning lower, with Fujitsu losing 11 to 812, NEC 22 lower at 806, Hitachi down 23 at 730 and Toshiba off 17 at 472.

High-techs were also broadly lower, with Rohm 500 lower at 17,450, Advantest shedding 260 to 7,180 and Tokyo Electron losing 459 to 7,350.

Sony fell 170 to 6,020 and Matsushita Electric lost 41 to 1,607.

Bridgestone Corp rose 19 to 1,664 after a report that the firm will post net profit of about 68bn (€570m) yen for the year to December, 3.9 times higher than the profit earned in 2001 and up 3bn yen (€20m) from its original forecast.