TEPCO on shaky ground amid worries of nationalization
TEPCO shares were left untraded on a glut of sell orders amid concerns that the government would be nationalizing the company after the Fukushima nuclear plant disaster.
Japan's Nikkei average fell on Tuesday, hurt by growing worries about the crippled nuclear plant and the impact of the earthquake and tsunami on corporate earnings, with plant operator Tokyo Electric Power untraded on a report it may be nationalized.
The Nikkei's fall was exaggerated by around 83 points, according to estimates by market players, as it came under more selling pressure after the date passed for investors to receive dividends for the current business year ending March 31.
Shares of Tokyo Electric were untraded on a glut of sell orders after the Yomiuri newspaper said the government would temporarily nationalize it and help pay compensation for damage caused by its Fukushima nuclear plant.
"The situation in Fukushima has a big, underlying impact on the market, with worries over the plant likely impacting Wall Street yesterday," said Kazuhiro Takahashi, general manager at Daiwa Securities Capital Markets.
Plutonium found in soil at the Fukushima complex heightened alarm on Tuesday over Japan's protracted battle to contain the world's worst nuclear crisis in 25 years.
"As long as there are concerns that TEPCO may be nationalized, investors don't want to hold the stock. Passive funds are selling too," Nakajima said, adding that investors were reminded of panic selling of Japan Airlines shares last year when it decided to decrease capital.