Nikkei Jumps 1%; Renesas Denies Resumption Plans, Skymark Dives 15%

Nigel Thomas
18 May, 2011
New York City

The benchmark index in Tokyo jumped 1% after several news hinted at the recovering industrial climate and improving power condition in the central Japan industrial belt. Renesas Electronics may resume its production in June and reach full capacity by October but company sources deny the time table.

[R]4:10 PM Tokyo – The benchmark index in Tokyo jumped 1% after several news hinted at the recovering industrial climate and improving power condition in the central Japan industrial belt. Renesas Electronics may resume its production in June and reach full capacity by October but company sources deny the time table.[/R]

Stocks in Tokyo trading closed higher after talks of improved power conditions and earlier than expected resumptions of parts makers in electronics and auto industry.

The improving industrial climate set the tone in trading but investors remained cautious as banks face a one-time bill to forgive the Tepco debt. Banks traded higher on the talks that Mizhuo Financial Group will merge its corporate and retail banking operations.

The Nikkei 225 Stock Average gained 1% or 95.06 to 9,662.08 and the broader Topix index gained 1% to 837.96.

The yen weakened against the dollar to 81.57 and to 116.43 against the euro.

Stock Movers

Tepco increased 2.4% to 389 yen after the company left its previous target date to cool reactor by October and outlined detailed steps for a cold shutdown. The core temperatures at three reactors are still hovering above 100 degrees Celsius or 210 degrees Fahrenheit.

Renesas Electronics Corp gained 6% to 735 yen after the Nikkei business daily said that the company plans to resume its production at Naka plant with production rising to 105 in June, 50% by August and full production by October.

However, sources within the company questioned the early start of production.

Skymark Airlines dropped 15% to 1,045 yen after the company announced a plan to raise 21.3 billion or $260 million to fund the purchase of A380 planes. The offering will increase its outstanding shares by 28%.

Mizuho increased 3.2% to 131 yen and Mitsubishi UFJ Financial Group increased 2.4% to 385 yen. Sumitomo Mitsui Financial Group Inc gained 3.5% to 2,464 yen.

Inpex Corp increased 3% to 553,000 yen after the company said Northern Territory government in Australia approved the Ichthys liquefied natural gas project.