Nikkei Gains 2.7%; Nippon Steel Sales Up 30%

Chandrasekhar Atreya
28 Jul, 2010
New York City

The benchmark index in Japan surged 2.7% on strong earnings both at home and abroad. Nippon Steel returns to profit in first quarter. Nissan Motor is planning to boost vehicle output in the U.S.

[R]5:00 PM Tokyo, Japan – The benchmark index in Japan surged 2.7% on strong earnings both at home and abroad. Nippon Steel returns to profit in first quarter. Nissan Motor is planning to boost vehicle output in the U.S.[/R]

Stocks in Japan rallied taking the Topix index to its steepest gain in three weeks as the earnings announcement peak this week. The Nikkei 225 Stock Average had its largest one-day gain in a fortnight after hurtling through several resistance levels on strong corporate earnings at home and abroad as well as a weaker yen.

The Nikkei 225 Stock Average gained 2.7% or 256.42 points to close at 9,753.27, its highest close since July 14. The broader Topix gained 2.3% to close at 865.51 with more than seven stocks gaining for each that declined.

Of the 225 stocks in the Nikkei only 6 did not gain while 217 stocks gained and 2 were unchanged.

Yokohama-based Nissan Motor Co plans to boost output in Mexico to about 700,000 vehicles a year and also may consider exports from the U.S. as the stronger yen makes exports from North America more competitive.

“Based on the movement of currencies, there is a point in time where the competitiveness of exports from North America is going to increase,” said Carlos Tavares, Executive Vice President and head of Nissan’s operations in the Americas in an interview in San Jose, California yesterday.

Output of copper and copper-alloy fabricated products, including sheets and tubes surged 29% in June from a year earlier, the Japan Copper and Brass Association said.

Production reached 76,410 tons in June compared with 59,188 tons a year ago, the industry association said today, citing preliminary data.

Nippon Steel Ltd returned to a first quarter profit boosted by greater output and sales to tap demand in Asia. While sales gained 30% to 970.6 billion yen in the quarter ended June 30, net income touched 26.8 billion yen as compared to a loss of 42.2 billion yen last year, Tokyo-based Nippon said today in a statement.

Sumitomo Metal Industries Ltd and Kobe Steel Ltd are also scheduled to report results tomorrow.

Gainers & Losers

Shinsei Bank Ltd led the gainers in the Nikkei with a gain of 12.12% to 74 yen followed by Fuji Heavy Industries 6.78% to 488 yen and T&D Holdings 6.38% 1,952 yen.

Yahoo Japan Corp led the decliners with a loss of 2.99% to 34,100 yen followed by Tokyu Corp 0.52% to 380 yen and Fanuc Ltd 0.38% to 10,360 yen.