Nikkei Index Extends Gains; Solar Energy Linked Stocks Up

Nigel Thomas
01 Jun, 2011
New York City

Stocks extended gains for the second day in a row but the gains were muted. Resources linked stocks closed higher on a rise in commodities and metals prices. Automakers led the gainers. Solar energy linked stocks gained on the prospect of higher government commitment.

[R]4:30 PM Tokyo – Stocks extended gains for the second day in a row but the gains were muted. Resources linked stocks closed higher on a rise in commodities and metals prices. Automakers led the gainers. Solar energy linked stocks gained on the prospect of higher government commitment.[/R]

Stocks in Tokyo muted gains for the second day after a surge of 2% in the previous session. The benchmark index held on the gains after the weak set of U.S. economic data and the ongoing debt worries in the euro-zone.

Investors also paid attention to the growing possibility of a split in the ruling party that may lead to a no-confidence vote motion in the Diet.

Prime Minister Naoto Kan is expected to survive no-confidence motion.

The Nikkei 225 Stock Average increased 0.3% to 9,719.61 and the broader Topix added 0.1% to 839.41.

The yen traded at 81.25 to a dollar and 114.56 for one euro.

Stock Movers

Resource stocks closed higher after commodities gained.

Japan Petroleum Exploration Co added 1.4% to 3,935 yen and Idemitsu Kosan Co increased 2.8% to 9,240 yen.

Tokyo Electric Power dropped 5.7% to 299 yen, Chubu Electric declined 2.2% to 1,254 yen and Hokkaido Electric Power Co. declined 1.5%.

Sony Corp increased 2.6% 2,176 yen after Chief Financial Officer Masaru Kato in an interview with the Nikkei newspaper that the company is looking to cut operating losses in its television business unit by half in the current fiscal year.

Automakers closed higher for the second day in a row after Toyota is expected to reach 90% of pre-quake production level.

Toyota Motor declined 0.3% to 3,390 yen and Nissan Motor fell 0.9% to 807 yen.

Solar energy related companies gained for the third day in a row after Prime Minister Kan doubled the target share from renewable energy in the early part of the next decade.

Takashima & Co., Ltd soared 5.4% to 255 yen and Sankyo Metal Industrial Co Ltd soared 12% to 368 yen. Nikken Kogaku Co. Ltd soared 4% to 86 yen and Mitani Corp soared 8.7% to 1,099 yen.