Drastic Drop in Japan's stock market

Capital injection pledged on first business day since quake and tsunami hit northeast and stoked nuclear disaster fears.



Three days after a devastating earthquake hit Japan, the stock market in Tokyo has reopened - and its performance shows just how big the damage to the country's economy could be.


Share prices dropped sharply by more than five per cent within the first hour of trading on Monday. Moving quickly to try to keep financial markets stable, the Bank of Japan said it will inject $85bn into the money market to try to bring some stability.


The humanitarian crisis is deepening too, with thousands of people still missing as a result of Friday's 8.9 magnitude earthquake and resultant tsunami.


On the brighter side, foreign aid has begun arriving. A US naval ship is being used to help send out supplies and an aircraft carrier is also on its way to help.


But millions remain without electricity, and there are growing fears about the safety of the Fukushima nuclear plant where a state of emergency is in force.


All this leaves Japan facing its worst crisis since the second world war, according to the country's prime minister, Naoto Kan.





For their part, nuclear plant engineers were frantically working to keep temperatures down in a series of reactors, as the possibility of a nuclear disaster threatened to complicate matters.


Authorities declared a state of emergency at a nuclear facility in the town of Onagawa on Sunday after excessive radiation levels were recorded there, the UN's International Atomic Energy Agency said.


Engineers are facing fears of a partial meltdown in two reactors at the Fukushima Dai-ichi nuclear plant in the wake of Friday's earthquake and tsunami that are believed to have killed thousands of people.


Yukio Edano, Japan's chief cabinet secretary, said on Sunday that a partial meltdown in Unit 3 at the Fukushima facility was "highly possible".


"At the risk of raising further public concern, we cannot rule out the possibility of an explosion," Edano said. "If there is an explosion, however, there would be no significant impact on human health.


"Because it's inside the reactor, we cannot directly check it but we are taking measures on the assumption of the possible partial meltdown."


About 170,000 people have been ordered to evacuate the area covering a radius of 20km around the Fukushima plant.


Thousands of people have been taken to emergency shelters along the northeastern coast as strong aftershocks continue to shake Japan's main island.


"As to Friday's earthquake and tsunami and the current situation of the power plants in Fukushima, in the 65 years after the end of World War II, this is the toughest and the most difficult crisis for Japan in that period," Kan said in a televised address to the nation," Kan, the prime minister, said in a televised address.


He also said Japan is at risk of large-scale power outages and must save energy after the earthquake shut down some atomic power plants.