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Nikkei lower as growth worry resumes

Tuesday, February 05 07:30:25

Japan's Nikkei share average fell today, snapping a five-day winning streak as renewed worries about the euro zone crisis triggered profit-taking from recent gains, with the benchmark pulling away from a 33-month high hit the previous day.

The Nikkei dropped 1.9 percent to 11,046.92, moving away from a 33-month closing high of 11,260.35 hit on Monday.

The Nikkei's volume hit 3.85 billion shares, the highest level since March 2011.

With the Nikkei adding 4 percent in the past five days, investors took renewed concerns about the euro zone debt crisis as a reason to lock in profits.

In Europe, Spanish and Italian bond yields rose after a corruption scandal prompted calls for Spanish Prime Minister Mariano Rajoy to resign and on news of a probe of alleged misconduct involving an Italian bank three weeks before national elections.

"The Nikkei is seen rising further in the longer term, but the market has been looking for a correction. In the short term, the Nikkei's resistance is seen around 11,300," said Tsutomu Yamada, a market analyst at Kabu.com Securities. Yamada added that if the Nikkei breaches this level, the highest since April 2010, it will likely enter the next stage to chase the market higher to 12,000. ( C) Reuters