Nikkei in Tokyo Rebounds 1.5%; Banks, Exporters Lead

Nigel Thomas
25 Aug, 2011
New York City

Stocks in Tokyo trading rebounded and the yen weakened a fraction. Exporters and trading companies gained. Energy and resource linked companies advanced as the oil firmed. Banks rebounded a day after Japanese government debt was lowered.

[R]6:00 PM Tokyo – Stocks in Tokyo trading rebounded and the yen weakened a fraction. Exporters and trading companies gained. Energy and resource linked companies advanced as the oil firmed. Banks rebounded a day after Japanese government debt was lowered.[/R]

Stocks in Japan gained after the latest economic reports from the U.S. offered a sigh of relief. The durable goods orders were ahead of expectations but the housing market continued to struggle. Regional economic picture continues to be bleak but exports are running ahead of expectations.

The yen edged lower to 76.75 from 76.55 in volatile trading but on low volume as the government announced more measures to weaken the yen. Investors are still factoring strong yen by the end of the year and the currency to trade below 80 yen to a dollar.

A day ago, Finance Minister Yoshihiko Noda proposed $100 billion credit facility to Japanese exporters as the yen surges to a 25-yer high, however the measure is likely to have little impact on the value of the yen.

The Nikkei 225 Stock Average added 132.75 or 1.5% to 8,772.36 and the broader Topix index gained 9.58 or 1.3% to 751.82.

Trading volume on the First Section of the Tokyo Stock Exchange declined to 2.05 billion from 2.18 billion shares on Wednesday and 1,092 shares fell and 458 increased.

Stock Movers

Banks rebounded a day after the Japanese government debt was downgraded by Moody’s rating agency. The decision is expected to have no impact on the investor sentiment as domestic investors prefer to invest in Japanese government bonds.

Mitsubishi UFJ Financial Group added 1% to 333 yen and Sumitomo Mitsui Financial Group gained 7 yen to 2,177 yen. Mizuho Financial Group added 1 yen to 112 yen.

Energy linked companies traded higher after crude oil in New York gained as Libya struggles to resume oil export.

Inpex Corp increased 3.2% to 490,500 yen and Japan Petroleum Exploration Co added 2.3% to 3,120 yen.

Automakers and exporters traded active after finance minister offered a credit facility to exporters of $100 billion.

Toyota Motor increased 1.7% to 2,764 yen and Honda Motor Co. added 5.4% to 2,443 yen and Nissan Motor soared 7% to 673 yen.

Sony Corp rose 2.1% to 1,581 yen and Panasonic advanced 3.8% to 792 yen. Nikon Inc increased 7 yen to 1,669 yen. Canon Inc fell 20 yen to 3,580 yen.

Renesas Electronics gained 5.3% to 500 yen and Elpida Memory added 2.5% to 455 yen.

Construction equipment makers liked to China closed higher. Komatsu shot up 5.9% to 2,000 yen and Hitachi Construction Machinery advanced 5.2% to 1,363 yen.

Murata Manufacturing added 3.2% to 4,585 yen, Nintendo Co. Ltd gained 1.7% to 12,640 and Omron inched up 5.4% to 1,751 yen.

Kansai Electric Power declined 3.9% to 1,341 yen on the ongoing worries that the company is still struggling to resort full power supply and faces higher fuel charges to replace nuclear materials with natural gas and coal.

Dai-Ichi Life Insurance Co. added 3.2% to 89,900 yen.