Nikkei Surges 1.1% on Steel Merger; Mitsubishi Estate Up

Nigel Thomas
04 Feb, 2011
New York City

Stocks in Japan surged on the merger announcement between Nippon Steel and Sumitomo Metals Industries. Mitsubishi Estate Co said nine month net increased on sales rise of 0.8%. Nikkei index rose 1.1% today and gained 1.8% in the week.

[R]5:00PM Tokyo – Stocks in Japan surged on the merger announcement between Nippon Steel and Sumitomo Metals Industries. Mitsubishi Estate Co said nine month net increased on sales rise of 0.8%. Nikkei index rose 1.1% today and gained 1.8% in the week.[/R]

Stocks in Tokyo trading gained after two steel companies agreed to merge and better than expected earnings outlook from Softbank and Hitachi.

The Nikkei 225 Stock Average increased 1.1% to 10,543.52 and the Topix gained 0.8% to 935.56. For the week, the Nikkei gained 1.8% and the Topix increased 1.7%.

Nippon Steel soared 9.1% to 313 yen and Sumitomo Metals Industries surged 16% to 224 yen. The merger between the two steel companies is expected to improve earnings and bargaining position to acquire raw materials from Australia and other nations.

Stock Movers

Mitsubishi Estate Co. increased 0.4% to 1,590 yen after it reported nine months income increased to 44.4 billion yen and revenues gained 0.8% to 645.8 billion.

Rental income increased to 25,008 yen per tsubo from 24,976 per tsubo in the previous quarter.

The company affirmed its annual net income estimate of 62 billion yen and sales of 975 billion yen.

Mitsubishi UFJ gained 0.9% to 440 yen after it reported net profit that more than doubled and was ahead of analysts’ expectations.

Softbank Corp gained 3.5% to 2,976 yen after the technology and telecom company lifted its annual net profit increase of 20%.

Hitachi increased 3% to 487 yen after it estimated fiscal year earnings to rise 15% on higher cost cuts.

Mazda Motor Corp dropped 4.5% to 228 yen after the automaker reported a loss in the December quarter of 2.67 billion yen.

Sony Corp increased 1.8% to 2,919 yen after it reported yesterday net income of 72.3 billion yen in the quarter to December.