Nikkei slides to 4-yr low, economic worry grows

Automakers such as Toyota Motor Co slid along with Kyocera Corp and other high tech shares as investors dumped stocks just after the opening. The losses came even after the U.S. House of Representatives passed a $700 billion financial rescue plan as market attention shifted from worry about whether or not the proposal would pass to concern about how it will be carried out.

"The bleeding has been stopped for now, but the question is, will the rescue plan actually work?" said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

Other market participants said widespread slides in U.S. shares showed the impact of the financial crisis was expanding into a broad swathe of the economy. "Financial shares have been volatile for some time, but now we're seeing selling of a lot of other sectors as well as worry about the rescue plan now becomes worry about company results," said Masayoshi Okamoto, head of dealing at Jujiya Securities.

"The economic slowdown is moving to centre stage as the key market factor, and having it come just as corporate earnings are coming out is a really bad thing."

A number of U.S. companies are set to announce results this week, with Japanese results getting into higher gear later this month.

At 0030 GMT the benchmark Nikkei had shed 275.85 yen, hitting levels unseen since October 2004. The broader Topix was down 2.5 percent at 1,021.24.

The dollar was fetching around 104.25 yen despite starting the day above 105 yen.

Kyocera had slipped 5.6 percent to 7,300 yen, becoming the biggest drag on the Nikkei 225 by volume weight. It was followed closely by Tokyo Electron Ltd, down 7 percent at 4,080 yen, and industrial robot maker Fanuc Inc, which slid 3.7 percent to 7,060 yen.

Honda Motor Corp was down 2.8 percent at 2,755 yen and Sony Corp fell 5 percent to 2,855 yen. Canon slipped 2.6 percent to 3,750 yen.