Japan's Nikkei 225 Stock Average fell to its lowest point in seven weeks, paced by digital-camera makers, after Nikon Corp cut its annual profit forecast by 36 percent as competition drives prices lower.

　　The Nikkei shed 0.4 percent to 10,365.40, the lowest since Christmas Day, at the 3pm close in Tokyo. Nikon slumped 10 percent, the biggest decliner on the first section of the exchange, while rivals Pentax Corp, Olympus Corp and Casio Computer Co all fell more than 4 percent.

　　"It doesn't look good right now" for digital camera makers, said Takaaki Yoda, who oversees US$1.7 billion in Asian equities as chief investment officer at APS Asset Management (Japan) Co in Tokyo.

　　Elsewhere in Asia, Sri Lanka's stock index shed 3.9 percent, bringing its two-day decline to 14 percent, on concern an early election called by the president would disrupt the peace process with the island's rebels.

　　Hong Kong's Sun Hung Kai Properties Ltd led the city's property stocks lower on concern a rally in their share prices more than reflected demand for homes. Copper miners such as BHP Billiton and Rio Tinto Group, gained after the price of the metal climbed on expectation that increased US economic growth will spur demand.

　　The Philippine Stock Exchange Composite Index rose 0.8 percent, making it the biggest gainer in Asia. Philippine Long Distance Telephone Co climbed on optimism earnings due later this month will show business growth.

　　The Morgan Stanley Capital International Asia-Pacific ex-Japan Index, which tracks 540 companies in the region, rose 0.2 percent, its fourth straight advance.

　　Benchmarks in Taiwan, South Korea and Thailand rose, while others in the region fell or were little changed.

　　Nikon fell 155 yen (US$1.46) to 1,342 yen. The company, also the world's largest maker of machines used to print circuitry on to silicon wafers, cut its annual profit forecast to 3.5 billion yen, from 5.5 billion yen after reporting a loss in the last nine months of 2003.

　　The company said the loss followed price pressure in the digital camera market and a "still cautious stance" by chipmakers toward investment. Nomura Holdings Inc, Japan's largest brokerage, said investors should sell the stock because of Nikon's comments.

　　Olympus, a digital-camera maker, declined 4.5 percent to 1,939 yen. Pentax dropped 5.3 percent to 568 yen, while Casio fell 4.4 percent to 1,026 yen. Konica Minolta Holdings Inc shed 2.6 percent to 1,291 yen.

　　Among rival chipmaking equipment makers, Tokyo Electron Ltd, the world's second-largest maker of chip-production equipment, slid 3.5 percent to 6,720 yen.

　　KDDI Corp, Japan's No. 2 mobile-phone operator, fell 3.8 percent to 560,000 yen after Nomura told investors to reduce holdings in mobile-phone operators because of rising competition in high-speed services.

　　"It will be difficult for them to cover their costs as prices come down," said Haruki Yamaguchi, who oversees US$7.6 billion as chief investment officer at Yasuda Asset Management Co in Tokyo. He holds fewer shares of communications stocks than their representation in the Topix index.

　　Sri Lanka's Colombo All Share Index fell to 1,016.66, according to updated figures from the Colombo Stock Exchange's Website. John Keells Holdings Ltd and Sri Lanka Telecom Ltd, two of the largest companies by market value, led the decline on concern polls will disrupt a peace process with Tamil Tiger rebels.

　　President Chandrika Kumaratunga has not yet discussed her decision to dissolve parliament and call for early elections on the weekend.

　　Sun Hung Kai, Hong Kong's biggest developer by market value, lost 1.6 percent to HK$77.25 (US$9.9). Cheung Kong (Holdings) Ltd, Hong Kong's second largest, fell 0.7 percent to HK$74.25.

　　"I don't think there's a lot of upside left," said Lawrence Lai of Lotus Asset Management Ltd.

　　The Hang Seng Property Index shed 1.2 percent. It had risen 37 percent in the past six months.