Japan braces for potential radiation catastrophe

 
Japan raced to avert a catastrophe on Wednesday after an explosion at a quake-crippled nuclear power plant sent radiation wafting into Tokyo, prompting some people to flee the capital and others to stock up on essential supplies.
The crisis escalated late on Tuesday when operators of the facility said one of two blasts had blown a hole in the building housing a reactor, which meant spent nuclear fuel was exposed to the atmosphere.
Prime Minister Naoto Kan urged people within 30 km (18 miles) of the facility -- a population of 140,000 -- to remain indoors, as Japan grappled with the world's most serious nuclear accident since the Chernobyl disaster in Ukraine in 1986.
Officials in Tokyo -- 240 km (150 miles) to the south of the plant -- said radiation in the capital was 10 times normal at one point but was not a threat to human health in the sprawling high-tech city of 13 million people.
Toxicologist Lee Tin-lap at the Chinese University of Hong Kong said such a radiation level was not an immediate threat to people but the long-term consequences were unknown.
"You are still breathing this into your lungs, and there is passive absorption in the skin, eyes and mouth and we really do not know what long-term impact that would have," Lee told Reuters by telephone.
Around eight hours after the explosions, the U.N. weather agency said winds were dispersing radioactive material over the Pacific Ocean, away from Japan and other Asian countries.
As concern about the crippling economic impact of the nuclear and earthquake disasters mounted, Japan's Nikkei index fell as much as 14 percent before ending down 10.6 percent, compounding a slide of 6.2 percent the day before. The two-day fall has wiped some $620 billion off the market.
On Wall Street, stock in General Electric Co, the largest U.S. conglomerate, fell nearly 4 percent on concern the crisis will cost it tens of billions of dollars in lost sales and potential legal costs or even liability over its nuclear technology.
Authorities have spent days desperately trying to prevent the water which is designed to cool the radioactive cores of the reactors from running dry, which would lead to overheating and the release of dangerous radioactive material into the atmosphere.
They said they may use helicopters to pour water on the most critical reactor, No. 4, within two or three days, but did not say why they would have to wait to do this.
"The possibility of further radioactive leakage is heightening," a grim-faced Kan said in an address to the nation earlier in the day.
"We are making every effort to prevent the leak from spreading. I know that people are very worried but I would like to ask you to act calmly."
Levels of 400 millisieverts per hour had been recorded near the No. 4 reactor, the government said. Exposure to over 100 millisieverts a year is a level which can lead to cancer, according to the World Nuclear Association.
The plant operator pulled out 750 workers, leaving just 50, and a 30-km (19 mile) no-fly zone was imposed around the reactors. There have been no detailed updates on what levels the radiation reached inside the exclusion zone.

Yen soars as investors exit riskier trades

 
The yen rose broadly on Tuesday, edging toward a record high against the dollar, as Japanese companies brought money home and investors closed riskier trades amid fears of a nuclear catastrophe in Japan.
The U.S. dollar fell as low as 80.60 on trading platform EBS, not far from its record low of 79.75 struck in 1995. Traders said a New York daily close below 81.70 would signal a further drop toward the pair's historical low.
Demand for the yen has soared since Japan's devastating earthquake and tsunami on Friday on expectations Japanese insurers and companies will repatriate funds to help pay claims and reconstruction costs.
A sharp sell-off in global equity and commodity prices also prompted investors to buy back the yen as they unwound trades in higher-yielding assets. The low-yielding yen has been a favorite funding currency for these trades in recent years.
"Japanese institutions are believed to be liquidating overseas investments," said Brian Dolan, chief strategist at Forex.com in Bedminster, New Jersey. "And that forces other people to exit long carry trade positions and long risk positions. It really just becomes a negative feedback loop."
The dollar held steady against the euro and yen after the Federal Reserve maintained its ultra-loose monetary policy.
The U.S. central bank said the economy was gaining traction but flagged potential inflation risks from costlier energy and food.
"The most interesting thing is their saying commodities are putting upward pressure on inflation. They're signaling that they're starting to watch energy prices. If we see oil at levels near $100, it might suggest the Fed raises rates sooner rather than later," said Greg Salvaggio, vice president of trading of Tempus Consulting in Washington.
The dollar last traded at 80.86 yen, down 0.9 percent on the day. Traders noted support around 80.25, the November trough. Strong long-term support stands at the psychologically important 80.00 barrier and the 79.75 historical low.
Japan faced a potential catastrophe on Tuesday after a quake-crippled nuclear power plant exploded and sent low levels of radiation floating toward Tokyo, prompting some people to flee the capital and others to stock up on essential supplies.
The euro lost 0.9 percent to 113.14 yen EURJPY=EBS.The yen rallied particularly strongly against higher-yielding currencies such as the Australian and New Zealand dollars.
The Australian dollar slid to a nine-week low of $0.9815 against the U.S. currency and a four-and-a-half-month low of 79.23 yen, according to Reuters data. Japan is Australia's second-largest export destination and in the short term, a drop in trade receipts will hit Australian growth, UBS said.
Asset managers, hedge funds, corporates and private clients were all net buyers of the yen for the first time since October, UBS said in a note on Monday. "Long yen positions are now considerable, and growing." the bank said.
The traditional safe-haven Swiss franc rose, with the U.S. dollar sliding to a record low around 0.9140 on EBS.
The yen earlier briefly trimmed gains as a 100-basis-point drop versus the dollar spurred vague talk of yen-selling intervention by Japanese authorities. Traders later said there was no intervention, but they were wary Japan may act to stem a sharp yen rise, especially if the dollar were to fall below 80 yen.
"It seems fairly clear right now that neither the BoJ nor the government want to see currency instability and will undoubtedly be prepared to intervene to prevent significant declines in the dollar," said Michael Woolfolk, senior strategist at BNY Mellon in New York. "We think the line in the sand is at 80 yen. If we fall to there, they will come in."

Radiation plume could reach Tokyo: U.S. scientists

 
If the containment at the nuclear power plant damaged by Japan's devastating earthquake fails, a potential radiation plume from a full core meltdown could reach Tokyo, a U.S. scientists' organization said on Tuesday.
Japan faces a potential catastrophe after a stricken nuclear power plant exploded and sent low levels of radiation floating toward Tokyo, prompting some people to flee the capital and others to stock up on essential supplies.
The Union of Concerned Scientists also said a "jerry-rigged" cooling system at the Japanese plant would be hard to maintain if all workers there were evacuated.
Nuclear power and safety experts at the group said they were "very concerned" that ongoing activities at the plant would become more challenging for on-site workers. A larger radiation plume could travel hundreds of miles (km), the scientists said in a telephone briefing.
A crack in the containment vessel could allow radiation to exit the reactor in case of a core meltdown, the scientists said. They said the Japanese government should extend the evacuation zone around the troubled Fukushima Daiichi power station.