InsideJapan News Network

Japan's benchmark Nikkei 225 has finished 42 per cent down in trading at the end of the year.

The drop is greater than the 39 per cent fall seen during the 1990 recession, reports the Daily Telegraph.

Tsuyoshi Nomaguchi, a strategist at Daiwa Securities in Tokyo, commented: "This year was a total disaster. Nobody expected it to fall as much as it did."

Exporters, including Honda, Sony and Toyota, have been forced to drastically reduce their profit forecasts and axe jobs due to falling orders.

Akira Ishida, head of equities at Chuo Securities in the capital, said: "Next year will be even tougher."

The Nikkei closed early today (December 30th) and will not open again until January 5th 2009.

Reuters reports that Japanese steelmakers are likely to be among the businesses cutting their operating profit forecasts.

Nippon Steel and JFE Holdings both face cuts of around 12 per cent in profits this financial year.