Nikkei Rebounds to 7-Month High

Chandrasekhar Atreya
13 Dec, 2010
New York City

The benchmark index hovered near 7-month high after china tightened credit and higher flows to stocks. Net inflows into Japanese stock investment trusts rise to 305.2 billion yen in November.

[R]5:00 PM Tokyo, Japan – The benchmark index hovered near 7-month high after china tightened credit and higher flows to stocks. Net inflows into Japanese stock investment trusts rise to 305.2 billion yen in November.[/R]

Tokyo stocks rebounded in the afternoon pushing the benchmark index to a 7-month high since May 14. Better-than-expected U.S. economic data and China’s decision to tighten credit boosted investor confidence in Tokyo.

The Nikkei 225 Stock Average gained 0.8% or 81.94 points to close at 10,293.89. The broader Topix added 1% to 897.40 with all of its 33 industry gauges rising.

The yen depreciated to 84.17 against the dollar from its Friday closing of 83.67 yen to a dollar.

The world’s nations agreed on Saturday to a package of climate initiatives including billion of dollars in funding for poor countries, although they failed to agree on a binding climate treaty amid stalemate among some countries like the U.S., China, Japan.

Sumitomo Corp Saturday confirmed that it will invest in Molycorp Inc, a U.S.-based producer of rare earth elements.

Sumitomo will pay $100 million, or roughly 8 billion yen, to buy Molycorp shares apart from a loan of $30 million. Based on the current price of Molycorp Inc, Sumitomo’s stake will be about 3%.

Nissan Motor Co delivered on Saturday its first Leaf electric vehicle in California to a 31-year old entrepreneur living in a suburb of San Francisco.

At an event on the same day in the city, Nissan Executive Vice President Carlos Tavares said the Leaf would be the world’s first mass-produced electric vehicle that emits no exhaust gases and does not depend on fossil fuel.

Kansai Paint Co said today it will make an acquisition offer to take over South African paint maker Freeworld Coatings Ltd increasing its stake from 27.6% to 100%. The offer will be 21.9 billion yen and the deal is expected to be completed by May next year.

A net inflow of 305.2 billion yen was recorded in Japanese stock investment trusts in November, the 19th monthly increase in a row, the Investment Trusts Association said today.

The net inflow in October was 282.2 billion yen, the association said.

Stock Movers

Nippon Steel Corp gained 2.7% to 301 yen and JFE Holdings Inc, Japan’s second-largest steel maker climbed 3.3% to 2,854 yen after both stocks were upgraded to “overweight” from “neutral” by JP Morgan Chase & Co.

SMC Corp, a maker of directional control devices, surged 2.4% to 14,250 yen after Credit Suisse AG raised it view on factory automation related companies in Japan to bullish from bearish.

Nabtesco Corp, a maker of hydraulic equipment, gained 5.9% to 1,690 yen and THK CO, an industrial machinery maker surged 5.6% to 1,912 yen.

Toshiba Corp added 1.89% to 440 yen.