5:00AM New York, 7:00PM Tokyo - Japan’s February trade surplus increases 0.9% to 970 billion yen.

Stocks in Japan fell despite a government report that showed exports, especially to emerging markets, helped offset a slowing demand in the U.S.

Market sentiment

In Tokyo trading Nikkei 225 dropped 0.3% or 38.59 to 12,706.63, and the broader Topix Index fell 0.4% or 5.43 to 1,237.55.

In the first section of the Tokyo Stock Exchange 7.3 billion shares worth 815 billion yen were traded and in the second section 170 million yen valued at 2.76 billion yen changed hands.

Of the Nikkei 225 stocks 88 rose, 124 declined and 11 were unchanged. Toho Zinc Co. Ltd. led advancers in the Nikkei 225 index shares with an increase of 7.21% after commodity prices gained.

Japan’s trade surplus widens

Japan’s Ministry of Finance reported today on its Web site that exports accelerated 8.7% to 6.98 trillion yen in February driven by demand from emerging markets such as China and India.

Imports advanced 10.1% on the year to 6.01 trillion yen, yielding a trade surplus of 0.9% at 970 billion yen.

While Japan''s trade surplus with the U.S. declined for the sixth consecutive month by 13.3% to 696.9 billion yen, the trade surplus with Asian nations including China climbed 104.8% to 922.2 billion yen, the seventh straight increase. Exports to Europe gained 7.2%.

U.S. consumer confidence declines in March

The Conference Board reported yesterday that the Consumer Confidence Index, which is based on a representative sample of 5,000 U.S. households, fell further to 64.5 in March from 76.4 in February.

The Expectations Index which measures an outlook for six months declined to 47.9 from 58.0, while the Present Situation Index fell to a 35-year low at 89.2 from 104.0 in February.

According to the report, those claiming business conditions are """"bad"""" increased to 25.4% from 21.3% and those claiming business conditions are """"good"""" declined to 15.4% from 19.1%.

Also consumers'' appraisal of the job market was more pessimistic in March than a month ago.

Japan to lose 2.6 trillion yen on gasoline tax

Bloomberg news reported today that JP Morgan Chase said in an interview that if Japan’s government fails to extend legislation on higher gasoline tax when it expires on March 31 it could lose at least 2.6 trillion in revenue.

The opposition Democratic Party of Japan, which controls the Upper House of Diet, is likely to block the extension.

Gainers & Losers

Toho Zinc Co Ltd. led advancers in the Nikkei 225 index shares with a rise of 7.21% followed by increases in Sumitomo Metal Mining of 4.63%, in Itochu Corp. of 4.39%, in Marubeni Corp. of 4.26%, and Mitsui & Co. of 4.25%.