The stocks of Indian companies, which have Japanese connections, took a hit on the bourses as news of the tsunami hit the markets.
However, market experts tend to speak high of Japan's ability to rebuild and rebound.
Stocks that saw selling pressure on Friday include Kansai Nerolac, Genesys International, Maruti Suzuki, Mastek, Zensar, Mercator Lines and MindTree.
Interestingly, Ranbaxy, now a Daiichi Sankyo company, firmed up 1.85 per cent to close at Rs 459.40 a share.
“Japan is quake-prone and it took them only a few months to recover from a big earthquake that struck Kobe in the mid-1990s. But the final impact can be assessed only post the aftershocks of the earthquake subside,” said Mr Gaurav Dua, Head-Research, Sharekhan.
The global investor community knows that the Japanese are better prepared than most countries when it came to natural calamities. “Japanese are hard wired to the fact that they live in a country where earthquakes and tsunamis are commonplace and are hence more responsible towards their business continuity planning than most countries,” said a mutual fund CEO.
“Their companies are always adequately insured against such calamities,” he added.
Experts said that the market reaction was kneejerk and on expected lines. But there is no reason to worry as the quake hit only the northern part of the country.
“The decision on how to fund rehabilitation is that of the government. In the last 69 years, Japan has never sold US treasury to fund any rehabilitation [Japan is one of largest investors in US treasuries],” said Mr Kishor Ostwal, CMD, CNI Research.
“They have always rebuilt using their own foreign exchange reserves and have an excellent capacity to do so,” he added, adding that most Japanese corporates have production facilities that are geographically well diversified to easily handle such calamities.