Nikkei Extends Gains in 4-day Rally; Banks, Sony up

Nigel Thomas
30 Aug, 2011
New York City

Stocks in Tokyo traded higher for the third day in a row. Japan elected Yoshihiko Noda, sixth prime minister in five years. Sony Corp and Hitachi and Toshiba are expected to form venture to make liquid crystal displays. Banks closed higher and energy linked stocks rebounded.

[R]6:00 PM Tokyo – Stocks in Tokyo traded higher for the third day in a row. Japan elected Yoshihiko Noda, sixth prime minister in five years. Sony Corp and Hitachi and Toshiba are expected to form venture to make liquid crystal displays. Banks closed higher and energy linked stocks rebounded.[/R]

The benchmark index in Tokyo edged higher for the fourth day in a row following gains in the Asian markets and a rise in the U.S. The U.S. market indexes gained after better than expected consumer spending data and a merger between two banks in Greece bolstered optimism in the euro-zone.

Yoshihiko Noda was elected as the next prime minister, sixth in five years and quickly proposed the plan to levy additional duty to finance rebuilding efforts after the earthquake.

Former prime minister Naoto Kan survived 15 months in the office and was the fifth prime minister in five years and suffered a blow to his credibility on the violation of a campaign financing law and weak response to March 11 triple disaster.

The yen edged lower to 76.90 from 76.87 after Japan appointed its sixth prime minister in five years.

The Nikkei 225 Stock Average added 1.2% to 8,953.90 and the broader Topix index gained 1.1% to 767.30.

Trading volume on the First Section of the Tokyo Stock Exchange declined to 1.28 billion from the week’s average of 2.1 billion shares.

Stock Movers

Mitsubishi UFJ Financial Group added 2% to 340 yen and Sumitomo Mitsui Financial Group increased 2.5% to 2,242 yen. Mizuho Financial Group inched up 0.9% to 114 yen.

Dai-Ichi Life Insurance Co. increased 200 yen to 88,100 yen.

Energy linked companies traded higher after crude oil in New York gained. Inpex Corp increased 3.2% to 507,000 yen and Japan Petroleum Exploration Co added 55 yen to 3,170 yen.

Nippon Yakin Kogyo Co dropped 14% to 170 yen after the company said it plans to raise 5.5 billion yen in a share offering that will dilute current shareholders.

Toyota Motor increased 7 yen to 2,721 yen and Honda Motor Co. increased 23 yen to 2,438 yen and Nissan Motor increased 5 yen 679 yen.

Sony Corp rose 3.5% to 1,695 yen after the company is expected to form an agreement with Hitachi Ltd and Toshiba Corp to manufacture liquid crystal displays.

Hitachi increased 2.1% to 411 yen and Toshiba added 2.1% to 339 yen.

Nikon Inc increased 21 yen to 1,693 yen. Canon Inc gained 30 yen to 3,575 yen.

JGC Corp added 2.8% to 2,213 yen after the engineering firm won a $400 million order to construct oil refining plant in Algeria.

Konami Corp soared 7% to 2,818 yen after the company first quarter sales were ahead of expectations on the higher revenues from the online gaming from social networks.

Construction equipment makers liked to China closed higher. Komatsu rose 0.9% to 2,005 yen and Hitachi Construction Machinery advanced 1.9% to 1,419 yen.

Kansai Electric Power decreased 22 yen to 1,370 yen.