Nikkei declines as techs head lower

Tokyo, Jul 11: The Nikkei average declined 0.78 per cent on Tuesday as technology-related firms such as TDK Corp. fell after similar U.S. shares were hit by a profit warning and a brokerage downgrade.

Shares of Kirin Brewery Co. Ltd. slid after Japan's second-largest beer maker raised its half-year profit forecast but which still fell short of market expectations.

Investors were selling Japanese tech stocks after a decline in U.S. tech shares increased concern about the outlook for the sector, said Yoku Ihara, manager of investment information at Retela Crea Securities.

U.S. technology stocks fell sharply on Monday after brokerage Merrill Lynch cut its rating on the sector and an earnings warning from data storage equipment maker EMC Corp. also hurt sentiment.

''U.S. techs haven't been faring well ... that is helping to weigh on Japanese technology issues, which are a mainstay of the Tokyo market,'' he said.

The Nikkei was down 120.78 points at 15,432.03 as of 0105 GMT.

The broader TOPIX index was down 0.77 percent at 1,581.73.

Electronic-components maker TDK declined 2.3 percent to 8,620 yen.

Toshiba Corp. dropped 2.5 percent to 740 yen.

Kirin Brewery fell 2.7 percent to 1,797 yen. The company raised its half-year profit forecast by 7.5 percent on Monday but that was still below market expectations.

REUTERS