Nintendo shares slide 10 percent
Wii and DS maker's stock opens the week down sharply despite last Thursday's upbeat financial report.
The stock market doesn't always follow conventional wisdom. Last Thursday, Nintendo reported its sales figures for the last nine months of 2007, revealing that it had doubled its revenues and profits over the same period the year before. While there was an initial spike in the publisher's share price after the news, that gain has since been lost and then some, with the stock dropping nearly 10 percent of its value during Monday's trading. Nintendo shares closed the day at ¥46,800 ($438), down from its previous close of ¥51,800 ($485). The company's stock is down 36 percent from its 52-week high of ¥73,200 ($685), which it hit in October.
A Reuters report offered a number of possible explanations for the drop. Given that so much of the Japanese company's business comes from foreign markets, the report said analysts are concerned a stronger yen could hurt its earnings. The report also mentions that some large investors sold off significant amounts of Nintendo stock, cashing out on the large gains the company has made over the previous years.
"This has little to do with the company itself, but a lot to do with market sentiment," Mizuho Asset Management fund manager Yoshihisa Okamoto told Reuters. "In the current market environment, investors rush to sell at the first sign of negative developments or exhaustion of positive news."