TOKYO (AP): Japanese shares nose-dived Friday as frantic investors dumped stocks following massive overnight losses on Wall Street and on growing fears of a global recession.
The benchmark Nikkei 225 index was down 7.7 percent at 8,453 in afternoon trading after falling by as much as 11 percent earlier in the day. The sharp falls prompted the Tokyo bourse and the Osaka Securities Exchange to briefly suspended some futures and options trading during the morning.
Japan's broader Topix index was down 7.9 percent.
``Selling is unstoppable in New York and Tokyo,'' said Yutaka Miura, senior strategist at Shinko Securities Co. Ltd. ``Investors were gripped by fear.''
The massive sell-off across Asia follows a 7.3 percent overnight drop in the Dow Jones industrial average, which closed below the 9,000-level for the first time in five years.
Accelerating the pessimism were insolvencies in the insurance and real estate sectors that weakened confidence the world's No. 2 economy would weather the global financial crisis relatively unscathed.
Yamato Life Insurance Co. went bankrupt Friday, becoming the first major Japanese financial company to collapse on the fallout from the U.S. credit crisis. On Thursday, New City Investment Corp.'s bankruptcy filing made it Japan's first real-estate investment trust to fail.
Friday's developments left individual investors in Tokyo shellshocked.
Kenji Akasaka, 69, president of a local printing company, said he had never seen it this bad in the 40 years he has traded stocks. He said he invests mainly in blue-chips including Toyota Motor Corp. and Nintendo Co. _ both of which have lost about half their value over the last year.
``I pray before I go to bed that the Dow will recover,'' said Akasaka, 69, as he scanned a monitor displaying the latest market levels. ``I get sleepless, thinking about losses.''
But Japanese Economy Minister Kaoru Yosano sought to reassure the country even as markets tumbled.
``We need to make sure that we don't get pulled too much by global tides,'' Yosano said. ``I hope investors Japan's makes decisions calmly based on Japan's economic fundamentals.''
Overnight, the Dow's 2,271-point tumble over the last seven sessions was its steepest seven-day point drop ever. Its seven-day percentage decline of 20.9 percent is the largest since the seven-day plunge ending Oct. 26, 1987, when the Dow lost 23.8 percent. That sell-off included Black Monday, the Oct. 19, 1987 market crash that saw the Dow fall nearly 23 percent in a single day.
Asia's falls come as finance ministers and central bankers from the Group of Seven industrialized nations prepared to meet later Friday in Washington.
``Investors are not so sure that the G7 will announce effective measures to contain the global financial crisis,'' Miura of Shinko Securities said.
All sectors posted huge losses, with insurance, real estate, steel and pharmaceutical issues taking especially big hits.
Tokio Marine Holdings Inc., Japan's largest casualty insurer, fell 10.9 percent, and Sompo Japan Insurance Co. was off 12.4 percent. Top developer Mitsubishi Fudosan Co. tumbled 8.1 percent.
In currencies, the dollar was trading at 98.96 yen Friday afternoon in Asia from 98.92 yen late Thursday. The euro stood at US$1.3516 from US$1.3560.
