By Patrick Rial
Jan. 7 (Bloomberg) -- Japanese stocks dropped, sending the Topix index below 1,400 for the first time in two years, on concern the U.S. economy is heading for a recession, and after the yen climbed against the dollar.
Toyota Motor Corp., the No. 2 seller of autos in the U.S., slumped 1.4 percent. Sony Corp. lost 1 percent.
U.S. payrolls rose by 18,000 in December, the fewest new jobs since 2003 and a quarter of what economists had forecast, while the unemployment rate jumped to 5 percent. The yen surged to as high as 107.91 versus the dollar in New York, the strongest since Nov. 27, reducing the local currency value of exporters' U.S. sales.
``The worsening figures out of the U.S. combined with the strengthening yen mean we can expect uneasiness in the market to continue this week,'' said Tomochika Kitaoka, a strategist at Mizuho Securities Co. in Tokyo.
The Nikkei 225 Stock Average lost 234.16, or 1.6 percent, to 14,457.25 as of 9:18 a.m. in Tokyo. The broader Topix fell 24.45, or 1.7 percent, to 1,387.46. It's the first time since October 2005 the gauge has slipped below 1,400.
Lenders such as Mitsubishi UFJ Financial Group Inc. slid after Swiss newspaper Sonntag reported yesterday Credit Suisse Group expects $2.3 billion in additional writedowns for the fourth quarter of 2007.
Nikkei futures expiring in March dropped 1.2 percent to 14,490 in Osaka and slumped 1.2 percent to 14,495 in Singapore.
In other Asian markets open for trading, Australia's S&P/ASX 200 Index tumbled 2.2 percent and South Korea's Kospi index dropped 2.4 percent.