Stocks in Japan Extend Gains; Honda Estimates Net to Drops 64%

Nigel Thomas
15 Jun, 2011
New York City

Stocks in Japan extended gains for the second day in a row after the government passed the bill to provide compensation to nuclear power plant disaster. China linked stocks also gained for the second day on strong economic data. Honda advanced on higher than expected profit estimate.

[R]5:20 PM Tokyo – Stocks in Japan extended gains for the second day in a row after the government passed the bill to provide compensation to nuclear power plant disaster. China linked stocks also gained for the second day on strong economic data. Honda advanced on higher than expected profit estimate.[/R]

Stocks in Japan extended gains for the second day in a row after the government passed a scheme to compensate the victims of nuclear power plant disaster. China linked stocks rose a day after the fast growing nation reported strong economic data.

The benchmark index traded as low as 0.3% but managed to recover in the afternoon on the back of higher close in New York and general strength in the Asian markets. U.S. retail sales declined for the first time in ten months but the fall was less than expected and was perceived to be transitory.

The Nikkei 225 Stock Average increased 0.3% to 9,574.32 and the broader Topix index added 0.2% to 824.65.

Tokyo trading volume increased to 1.97 billion shares from the 1.94 billion in the previous session. Advancing shares exceeded the declining shares by 825 to 663.

The yen strengthened to 80.28 from 79.60 against one dollar and rose to 115.4 from 113.45 against one euro.

Stock Movers

Honda Motor increased 2% to 2,990 yen after the company guided fiscal year 2012 net income to fall 65% to 195 billion yen on net sales and other operating revenue of 8.3 trillion yen.

Hino Motors increased 4.4% to 453 yen after it issued a positive earnings outlook. Toyota Auto body Co gained 6.5% to 1,303 yen on the positive profit view.

Tokyo Electric Power Co. soared 32% to 329 yen after the government passed the bill to compensate nuclear disaster victims that will not cut power supply in Japan and also prevent the utility from going under.

Other utility stocks gained after the passage of the bill.

Kansai Electric Power gained 1.6% to 1,298 yen and Chugoku Electric Power added 3.3% 1,190 yen. Tohoku Electric Power added 1.7% to 921 yen.

Construction machinery makers and China linked stocks rose for the second day in a row after China reported a surge in retail sales, industrial production and fixed investments.

Komatsu increased 2.3% to 2,372 yen and Hitachi Construction added 2.1% to 1,719 yen.