Nikon, Furukawa, Asahi Cut Oulook on Thai Floods; TSE, Osaka in a Deal

Nigel Thomas
07 Nov, 2011
New York City

Tokyo stocks edged lower in weak trading as more companies lower earnings hit by Thai floods. Nikon, Furukawa and Asahi Glass cut down full-year outlook. Tokyo Stock Exchange is nearing a deal to acquire a majority stake in Osaka Securities Exchange.

[R]6:00 PM Tokyo – Tokyo stocks edged lower in weak trading as more companies lower earnings hit by Thai floods. Nikon, Furukawa and Asahi Glass cut down full-year outlook. Tokyo Stock Exchange is nearing a deal to acquire a majority stake in Osaka Securities Exchange.[/R]

Stocks in Japan closed lower on the ongoing worries related to the euro zone. Greek parties agreed to form a unity government that will pass the budget and also approve the EU bailout under the new prime minister.

The interim government will operate until the next election that is likely to take place in mid-February. However, investors shifted their focus to Italy and the Prime Minister Silvio Berlusconi government may fall this week if it fails to win a confidence vote.

The Nikkei 225 Stock Average decreased 0.4% to 8,767.09 and the broader Topix index decreased 0.2% to 750.45.

In trading, 1.45 billion shares changed hands on the main board of the Tokyo Stock Exchange compared to 1.7 billion shares on Friday.

Central Bangkok is spared from the moving flood waters in Thailand but industrial estates are still threatened. The waters are receding in the north and northeast but water level are still high in Bangkok surroundings.

The government lifted the death toll from the floods to 506 and deputy governor of the Industrial Estate Authority of Thailand, Somkid Tanwatanakaul told reporters that flood waters are nearing the Lat Krabang Industrial Estate but the estate is still operating as usual.

Stock Movers

Asahi Glass Co. Ltd declined 41 yen to 622 yen after the glass maker cuts full year net income outlook 22% to 90 billion yen on production slowdown linked to Thai floods.

Toyota Motor decreased 6 yen to 2,546 yen and Honda Motor Co. fell 27 yen to 2,371 yen and Nissan Motor Co Ltd declined 12 yen to 723 yen.

Sony Corp decreased 3 yen or 0.2% to 1,403 yen, Panasonic Corp fell 7 yen to 726 yen and Canon Inc decreased 70 yen to 3,415 yen.

Nintendo Co. Ltd added 270 yen to 12,120 yen.

DeNA Co. increased 5% to 2,759 yen after it agreed to acquire 66.9% of Yokohama BayStars baseball team from Tokyo Broadcasting Systems.

Olympus Corp decreased 84 yen to 1,034 yen and was the fourth most active stock on the Tokyo Stock Exchange. The independent panel to investigate company mergers in the last three years will meet its former chief executive officer Michael Woodford in London this month.

Fanuc Ltd increased 60 yen to 12,940 yen and Kyocera closed up 80 yen at 6,890 yen.

Furukawa Electric Co. dropped 11.5% to 192 yen after it lowered its full-year net earnings outlook to a 5 billion yen loss on Thai floods related production disruptions.

Mitsui OSK Lines, Ltd increased 1 yen to 278 yen, Kawasaki Kisen Kaisha, Ltd closed down 2 yen to 148 yen and Nippon Yusen K.K. rose 1 yen to 191 yen.

Dai-ichi Life fell 2.4% to 84,000 yen as the yields on the Italian bonds hovered near the high in the last eleven years at 6.34%. The life insurance company holds bonds of Spain and Italy that have declined in value in the last five months.

Property and Casualty insurers declined on the mounting losses related to Thailand floods.

MS & AD Insurance Group Holdings, Inc closed unchanged at 1,529 yen and NKSJ Holdings Inc rose 16 yen to 1,561 yen.

Nikon Corp increased 3% to 1,799 yen after the camera and electronics equipment maker said earnings for six-months to September increased to 50.4 billion yen from 10.6 billion yen a year ago on sales increase of 22%.

Nikon also lowered its full-year earnings forecast to 55 billion yen and cited stronger yen and production disruptions linked to Thai floods.

Mitsubishi UFJ Financial Group rose 3 yen to 342 yen and Sumitomo Mitsui Financial Group increased 6 yen to 2,170 yen.

Mitsubishi Corp increased 31 yen to 1,617 yen and Mitsui & Co, Ltd rose 28 yen to 1,162 yen. Marubeni Corp increased 8 yen to 477 yen.

Komatsu Ltd decreased 4 yen to 1,966 yen and Hitachi Construction Machinery Co increased 26 yen to 1,563 yen.

Osaka Securities Exchange Co. soared 6% after the regional exchange operator and the Tokyo Stock Exchange entered in the final takeover talks according to several Japanese media reports. The TSE is expected to offer to buy between 50% and 66% of the Osaka exchange.