Stock Market Rout Puts These Japan Firms at Risk of Delisting

(Bloomberg) -- In Japan, pain from the December market rout is far from over. In a rare en masse filing today, eight companies warned investors they could face delisting because of their reduced market values.

About $938 billion of stock values were erased from the Japanese stock market last year, exacerbated by a 10 percent slide in the Nikkei 225 Stock Average in December, putting companies with less than 1 billion yen ($9.3 million) in market cap at risk. Companies whose daily average values remain below the 1 billion yen threshold for nine months would be delisted, according to Tokyo Stock Exchange rules. Those trading at less than 2 billion yen face demotion to the exchange’s second section.

Stock Market Rout Puts These Japan Firms at Risk of Delisting

Chugokukogyo Co., with a market cap of 1.69 billion yen as of today’s close, said in a statement it could face demotion.

The benchmark Topix index dropped 1.5 percent today in the first trading session of 2019, after capping its worst annual performance in seven years last week. The blue-chip Nikkei 225 Stock Average slid 2.3 percent as investors returned after the four-day New Year’s holiday. Global growth concerns triggered by an ongoing trade spat between the U.S. and China have taken a beating out of Japanese equities, which are often cited as one of the most cyclical markets.

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