Japanese stocks retreated, extending a weekly decline, on concern a shortage of funds could spark collapses in the automotive and electronics industries. Akebono Brake Industry Co., part-owned by Toyota Motor Corp., tumbled 15 percent after its chief executive officer said auto suppliers may fail without aid. Fuji Heavy Industries Ltd., the maker of Subaru cars, dived 7.1 percent after saying it asked for a government loan. Toshiba Corp. sank 6.4 percent after Goldman Sachs Group Inc. said it needs to bolster capital. Sumitomo Trust & Banking Co. lost 11 percent after Citigroup Inc.’s stock fell below $1 for the first time. “Investors are getting more and more worried about businesses’ survival as the end of the fiscal year draws near,” said Yoshihiro Ito, senior strategist at Tokyo-based Okasan Asset Management Co., which oversees about $9.3 billion. “The deterioration of Japan’s economy is way beyond that of other nations, and the market has entered a tunnel with no exit.” The Nikkei 225 Stock Average declined 260.39, or 3.5 percent, to close at 7,173.10 in Tokyo, just over 10 points away from its lowest close since October 1982. The broader Topix index dropped 20.16, or 2.7 percent, to 721.39, a level not seen since December 1983. The Nikkei lost 5.2 percent this week, while the Topix slid 4.7 percent, the biggest drops for both gauges since the period ended Jan. 23. The Nikkei has fallen 19 percent this year, extending its 42 percent tumble in 2008. A quarter of the gauge’s members have lost more than half their value in the past six months. Bankruptcies among Japan’s listed companies last year reached a record in the post-World War II period, according to Tokyo Shoko Research Ltd. Another 11 have gone bust so far in 2009. Government Aid Akebono Brake tumbled 15 percent to 500 yen, the sharpest drop since Oct. 8. CEO Hisataka Nobumoto, also chairman of the Japan Auto Parts Industries Association, said bankruptcies could result among suppliers if government support is limited to large automakers and car sales don’t recover. Aisin Seiki Co., a transmission-making affiliate of Toyota, lost 4.5 percent to 1,466 yen. Fuji Heavy, maker of Subaru-brand cars, plummeted 7.1 percent to 316 yen. The company applied for a loan from the state-run Development Bank of Japan for its daily operations, it said today. Elpida Memory Inc. slid 11 percent to 544 yen on a Nikkei newspaper report it will seek government loans after a rescue plan involving Taiwan’s government was delayed. ‘Negative Bias’ Toshiba, Japan’s biggest chipmaker, plunged 6.4 percent to 234 yen. Electronics maker Pioneer Corp., which expects a record net loss for the year to March 31, dived 8.8 percent to 93 yen. The two companies, as well as Elpida, are most in need of raising capital among Japan’s electronics makers, Goldman Sachs analysts including Daiki Takayama wrote in a report today. The analysts recommended selling Toshiba and Pioneer, while putting a “negative bias” on Elpida. In New York, the Standard & Poor’s 500 Index slid 4.3 percent to the lowest close since September 1996, led by financial companies. Shares of Citigroup, once the world’s biggest bank by value, tumbled to 97 cents before closing at $1.02, bringing this year’s decline to 85 percent. “People probably haven’t yet understood the full depth of the financial crisis,” said Yoshinori Nagano, a senior strategist at Daiwa Asset Management Co., which oversees about $96 billion. “Should regulators assess banks’ assets under strict conditions, quite a few of these companies may be effectively insolvent.” Sumitomo Trust, Japan’s fifth-largest bank, fell 11 percent to 281 yen, the lowest close since January 1999. Chuo Mitsui Trust Holdings Inc., Japan’s sixth-largest bank by assets, plummeted 9 percent to 242 yen, a level not seen since May 2003. Late Plunge Shinsei Bank Ltd. plummeted in the last five minutes of trading, closing down 8.1 percent to 80 yen after Nikkei English News said the bank will issue a statement on steps to strengthen its capital. Shinsei, part-owned by investor Christopher Flowers, said after the close it will sell preferred shares. Japan’s Financial Services Agency may extend restrictions on short selling of shares, an official at the regulator said today. The temporary restrictions, implemented in October and due to expire this month, include a ban on so-called naked short-selling and requirements that investors disclose short positions over a certain threshold. “Regulators are concerned they will send wrong messages to the market if they lift the ban,” said Daiwa Asset’s Nagano. “That is, authorities are OK with short-selling and a further tumble in the market.” Nikkei futures expiring in March retreated 3.2 percent to 7,170 in Osaka and slumped 3.1 percent to 7,175 in Singapore.

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