New Cabinet in Japan; Current Account Surplus

Mayank Mehta, Chandrasekhar Atreya and Sanjay Barot
08 Jun, 2010
New York City

Japanese stocks rose after three days of decline as the dollar and euro strengthened against the yen.

[R]7:00 PM Tokyo, Japan – Prime Minister Naoto Kan makes his first address to the nation and appoints a new cabinet and promises to focus on economic and political reforms. Japanese stocks rallied on improved export outlook after government reported a current account surplus in April. Nissan sees return to record sales by 2012.[/R]

Japanese stocks rose after three days of decline as the dollar and euro strengthened against the yen.

The Nikkei 225 Index in Tokyo closed higher 17.14 or 0.18% to 9,537.94 and of the stocks in Nikkei 225 Stock Average, 77 increased, 135 declined and 13 was unchanged.

Prime Minister Naoto Kan appointed his cabinet that is expected to focus on economic challenges of the nation, outsized debt and deal with political problems at home.

Earlier, Emperor Akihito sworn Mr. Kan officially as Japan’s fifth prime minister in four years at the Imperial Palace ceremony.

Shizuka Kamei, leader of Japan’s People’s New Party will continue as the nation’s financial services minister, overseeing the banking, securities and insurance industries, said Japan’s chief cabinet secretary, Yoshito Sengoku at a Tokyo briefing today.

Japan’s current account surplus widened in April from a year earlier, helped by solid exports to China and a pickup in exports to the U.S. and Europe.

As exports rose 43% from a year earlier and imports rose 26% for the same period, the current account surplus on a seasonally adjusted basis narrowed to 1.38 trillion yen in April from March, Ministry of Finance said in Tokyo today. The surplus rose 88% to 1.242 trillion yen in April from a year earlier.

Employees at Foshan-based Foshan Fengfu Autoparts Co struck work yesterday demanding higher pay adding to Honda Motor Co’s woes. The strike at this parts factory owned by Honda’s affiliate Yutaka Giken Co hasn’t immediately disrupted vehicle production at Honda as the car maker has sufficient inventory, said Honda spokesman Yoshiyuki Kuroda in Tokyo today.

The parts factory at Foshan in Guangdong province, supplies exhaust parts for the Honda Accord, Fit and Odyssey models.

Nikkei Movers

Taiyo Yuden Co., Ltd led gainers in the Nikkei 225 Stock Average with a rise of 5.7% followed by NTT Data Corp 4.2%, Isuzu Motors Ltd 3.9% and Yahoo Japan Corporation 3.7%.

Shinsei Bank, Limited led the decliners in the Nikkei 225 Stock Average with a loss of 4.3% followed by Asahi Glass Company, Limited 2.9%, Nippon Soda Co., Ltd 2.8%, JTEKT Corporation 2.8% and Advantest Corporation 2.6%.

Other Movers

Canon Inc rose 0.4% to 3,690.00 yen.

Honda Motor Co., Ltd rose 0.04% to 2,697.00 yen after the company said new strike has broken out at a factory making exhaust systems for one of the joint ventures in China, just days after the settlement of a strike at another Honda parts supplier in China.

Mitsubishi UFJ Financial Group, Inc fell 2.1% to 419.00 yen after the bank said approximately 5.1 million shares have traded hands Friday against the average 30-day volume of 3 million shares.

Nissan Motor Co., Ltd rose 0.9% to 640.00 yen after the company launched an upgraded version of its locally assembled X-Trail sports utility vehicle on Friday.

Nintendo Co., Ltd, the game maker, fell 1.9% to 25,320.00 yen.