The Nikkei share average fell for the third straight session today, declining 2.94 per cent before the Tokyo Stock Exchange halted trade 20 minutes earlier than usual, as a flood of orders on the world's second-largest stock market taxed its computer system.
More than $300 billion in shareholder value has been wiped out of the market this week - equal to about the gross domestic product of Sweden - much of it in the fall-out from an investigation into Internet portal firm Livedoor.
Internet firms and other companies popular with individual investors were among the hardest hit, with Softbank Corp. ending the day down by its daily limit of 500 yen, or 13 per cent.
The Tokyo exchange ended trade 20 minutes earlier than usual, after warning investors that it would halt trading when daily transactions reached the 4 million mark.
"It is an embarrassment for this to happen in the world's second-largest economy," said Hideo Ueki, chief investment officer at UBS Global Asset Management Japan.
"This problem will likely add to the growing negative sentiment in the market."
The Nikkei posted its biggest one-day percentage fall since April of last year, declining 464.77 points to 15,341.18. So far this week it has lost 6.8 per cent.
The broader TOPIX index fell 3.49 percent to 1,574.67. Word that the exchange's system was approaching its limit spurred steep selling, further shaking investors who had been rattled by the investigation into Livedoor.