The bearish global economic environment just keeps adding pressure to technology stocks.

As gross domestic product (GDP) drops in bourses around the globe, tech traders are nervous, at least for the short term. Take Japan. The Land of the Rising Sun is seeing a decline in GDP, falling to the lowest rate since 1974. If you take Japan, the globe’s biggest economy after the U.S. and China, and its tens of millions of consumers down a few economic notches, that’s going to continue to hurt global demand for products that Sony, Nintendo, Canon, Fujitsu, and Oki make, among other major Japanese technology companies, and that’s going to keep technology prices keep prices down.

With the major U.S. financial bourses off today, Japan’s Nikkei Index actually faired pretty well considering the bad news on the nation’s economy this weekend (more on that in a moment). Japanese technology leaders saw their stock prices drop, although not alarmingly: Sony (SNE) slipped 1.3% to ¥1,699; Canon Inc. lost 1.2% to ¥2,415; (semiconductor manufacturer) TDK slid 4.9% to ¥3,510 and Kyocera Corp. (another chip maker) dropped 2% to ¥5,760.

For the fourth quarter Japan's gross domestic product slipped 3.3 percent from the previous quarter, or an annual pace of 12.7 percent, in the October-December period, according to the Japanese government. Analysts had expected better, especially since the U.S. economy had fared three times better, “only” losing 3.3% for the same period.

Japan is especially vulnerable to economic downturns among the many countries it supplies technology products to. With reduced demand for cell phones, computer chips, laptop computers . . . basically everything but video games . . . Japan has nowhere else to turn, especially given the troubled market for cars and trucks for economic heavyweights like Toyota and Honda.

"There is no question that this is the worst economic crisis since the end of World War II," said Economy Minister Kaoru Yosano. "The outcome clearly shows that Japan's export-dependent economy has been severely hit."

How are Japanese technology companies coping with reduced demand amidst a weakening economy? Sony Corp. is a good case study. It recently announced deep job cuts and projected net losses for the fiscal year through March of this year. The company’s stock price has fallen from $24 per share in early January to $18.50 today.

Zacks Investment Research, for one, is increasingly bearish on Sony stock. In its most recent report on the Japanese tech giant, released on January 30, Zacks didn’t have many positive things to say about Sony.

“We believe Sony will continue to struggle as it faces competition from other innovative digital products and from low-cost Asian manufacturers as the consumer market slows. Sony posted lackluster Q3 results, hurt by sluggish sales in its core electronics segment due to the ongoing recession.”

“A strong yen, weak consumer demand, sliding consumer spending and an intensifying price competition are eating into its profits. Sony Corp. trimmed its forecast for 2008 and expects to record its first net loss in 14 years with much lower operating income. We therefore maintain a Sell recommendation on Sony shares and cut our six-month price target to $16.50.”

That commentary was written before the lousy Japanese GDP numbers came out. So Sony, which has lost about $3 billion in revenue – it’s first annual loss since 1995 – has an uphill climb, as do a lot of Pacific Rim technology companies who continually are pounded by wave after wave of bad economic and consumer news.

For investors, Japan is, for now, the Land of the Declining Sun. Until consumer demand picks up, console yourself with the old adage that it’s always darkest before the dawn.

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