Nikkei Jumps 1.8%; Foreigners Extend Sell-off to 7th Week

Nigel Thomas
15 Sep, 2011
New York City

Stocks in Japan rebounded on the euro zone optimism and tracking higher Asian markets. Exporters, ship liners and steelmakers led the advance. Banks also closed higher. The euro edged lower from the record low against the yen.

[R]6:00 PM Tokyo – Stocks in Japan rebounded on the euro zone optimism and tracking higher Asian markets. Exporters, ship liners and steelmakers led the advance. Banks also closed higher. The euro edged lower from the record low against the yen.[/R]

The benchmark index in Japan jumped on the back of optimism in the euro zone and higher markets in Asia. The Nikkei index gained 1.8% after falling 1.1% in the previous session and exporters and steelmakers led the advance.

German Chancellor Angela Merkel and French President Nicolas Sarkozy expressed confidence about the Greece’s place in the euro zone.

The video conference among Merkel, Sarkozy and Greek Prime Minister George Papandreou did not lead to any specific new announcement. The meeting was largely symbolic showing solidarity with the Greek government.

Greek Prime Minister Papandreou also reiterated that the country will stay on the course to trim the deficit and cut the government spending.

The Nikkei 225 Stock Average rose 1.8% to 8,668.86 and the broader Topix index added 1.4% to 751.76.

The yen edged lower to 76.85 from 77.35 against one dollar and the euro rose from the 10-year low to 105.29 after trading at 104.59 yesterday.

Trading volume on the First Section on the Tokyo Stock Exchange decreased to 1.68 billion shares, lower than 1.82 billion shares average last week.

Foreign investors lowered their Japanese stocks holding by 588.9 billion yen in the last week.

The selling was the largest weekly sale since the first week in June 2010 according to the data from the Tokyo Stock Exchange. The sale was the seventh weekly net selling in a row and the longest selling streak since the financial crisis in late 2008.

Stock Movers

Elpida Memory jumped 5% to 564 yen and Advantest Corp gained 2.7% to 885 yen. Tokyo Electron Ltd increased 4.6% to 3,780 yen. Dainippon Screen Manufacturing Co. surged 6% to 479 yen.

Elpida said it will shift some production to Taiwan to combat higher yen.

Mitsubishi UFJ Financial Group rose 5 yen to 330 yen and Sumitomo Mitsui Financial Group increased 23 yen to 2,095 yen. Mizuho Financial added 2 yen to 113 yen.

Inpex Corp increased 2% to 497,500 yen and Japan Petroleum Exploration Co increased 71 yen to 3,025 yen.

Steelmakers were on the rise on positive comments from a broker. Nippon Steel increased 8 yen to 231 yen and JFE Holdings, Inc rose 75 yen to 1,806 yen. Kobe Steel, Ltd added 4 yen to 139 yen.

Toyota Motor increased 56 yen to 2,690 yen and Honda Motor Co. added 92 yen to 2,388 yen and Nissan Motor increased 18 yen to 666 yen. Suzuki Motor increased 12 yen to 1,553 yen.

Sony Corp rose 12 yen to 1,513 yen, Panasonic Corp added 7 yen to 754 yen and Canon Inc decreased 25 yen or 0.7% to 3,270 yen.

Fanuc rebounded 2% to 10,940 yen. Kyocera added 2.2% to 6,750 yen.

Komatsu fell 6 yen to 1,724 yen and Hitachi Construction Machinery Co fell 2% to 1,324 yen.

Shipping companies closed lower. Nippon Yusen KK rose 7 yen to 229 yen and Mitsui O.S.K. Lines Ltd added 9 yen to 340 yen. Kawasaki Kisen Kaisha Ltd rose 3 yen to 181 yen.

Isetan Mitsukoshi Holdings increased 16 yen to 772 yen and Takashimaya Co added 9 yen to 535 yen. Fast Retailing Co increased 2.2% to 13,940 yen.