Nikkei at nearly 1-month closing low as property slides

By Elaine Lies

TOKYO (Reuters) - Japan's Nikkei stock average slid 0.6 percent to a nearly one-month closing low on Monday as Mitsubishi Estate Co Ltd and other property developers took a beating on reports of lower condominium prices, while blue-chip exporters slid after Wall Street tumbled.

Mitsubishi UFJ Financial Group and other banks were under pressure as fears of financial market troubles were reignited by warnings of more bank mortgage-related write-downs, but bargain-hunting helped them pare earlier losses that took the Nikkei down almost 2 percent at one point.

Precision-equipment maker Olympus Corp climbed after a ratings upgrade, boosting the overall market, while solar equipment suppliers surged on a report of government subsidies to support household use of solar systems.

After the market closed, Sharp Corp and Kansai Electric Power Co Inc said they had agreed to join forces in a solar power generation project that involves the construction of two solar power generation facilities.

But investors were wary of active trade before a U.S. Federal Reserve board meeting and a raft of economic indicators due out in Japan and the United States this week that include Japanese retail sales and U.S. consumer confidence and gross domestic product data.

"It's really a pretty directionless market," said Noritsugu Hirakawa, a strategist at Okasan Securities.

"There's still no real signs of economic recovery and with the FOMC and economic indicators coming up, nobody really wants to move today," he said.

While both the benchmark Nikkei and broader Topix fell nearly 2 percent in early trade, a surge of bargain-hunting and some short-covering in the afternoon helped trim losses. Market players said Japanese institutional investors appeared to be buying.