Bank of Japan Expands Stimulus Program, MS&AD Estimates Loss

Nigel Thomas
14 Feb, 2012
New York City

Stocks in Tokyo trading staged a reversal after the Bank of Japan expanded its asset purchase and lending program by $130 billion to $835 billion. Sumitomo Rubber gained on higher than expected income. MS&AD declined on sharply higher loss linked to Thai floods.

[R]8:30 PM Tokyo – Stocks in Tokyo trading staged a reversal after the Bank of Japan expanded its asset purchase and lending program by $130 billion to $835 billion. Sumitomo Rubber gained on higher than expected income. MS&AD declined on sharply higher loss linked to Thai floods.[/R]

Market averaged in Tokyo trading reversed course from the decline of more than 0.3% after the Bank of Japan unexpectedly expanded its asset buying and lending program.

The central bank increased the program 10 trillion yen to 65 trillion yen and which will provide cheap funding to banks against collateral of government and corporate bonds.

The Nikkei 225 Stock Average increased 0.6% to 9,052.07 and the broader Topix index added 0.6% to 786.80.

In trading, 2.2 billion shares changed hands compared to 2.05 billion shares in Monday’s trading.

The indexes opened lower after Moody’s lowered its views on credit quality of Italy, Spain and Portugal and three other nations following the similar change in opinions by Standard & Poor’s and Fitch Ratings.

Stock Movers

Toyota Motor increased 55 yen to 3,120 yen and Honda Motor Co. rose 16 yen to 2,796 yen and Nissan Motor Co Ltd added 7 yen to 766 yen.

Sony Corp decreased 22 yen to 1,490 yen, Panasonic Corp fell 2 yen to 641 yen and Canon Inc closed up 50 yen to 3,490 yen. Nintendo Co. Ltd closed unchanged at 10,760 yen.

Olympus Corp closed up 22 yen at 1,304 yen and Fujifilm Holdings Corp closed down 9 yen at 1,812 yen.

Nikon increased 2 yen 2,067 yen, Fanuc Ltd gained 220 yen to 13,430 yen and Kyocera rose 10 yen at 6,660 yen.

Sumitomo Rubber increased 1.8% to 968 yen after it reported 28.4 billion yen in full year net income.

Mitsui O.S.K. Lines, Ltd closed up 4 yen to 339 yen, Kawasaki Kisen Kaisha, Ltd closed up 8 yen at 171 yen and Nippon Yusen K.K. closed up 5 yen to 236 yen.

The Tokyo Electric Power Company, Inc increased 1 yen to 202 yen and a day ago the government approved additional 690 billion yen or $9 billion support to the troubled utility and demanded a greater voice in the management.

Fast Retailing Co. increased 80 yen to 15,710 yen and J. Front Retailing Co. Ltd closed up 4 yen to 374 yen.

Mitsubishi UFJ Financial Group increased 5 yen to 392 yen and Sumitomo Mitsui Financial Group closed up 32 yen at 2,599 yen.

MS & AD Insurance Group Holdings declined 1.3% to 1,668 yen after the property and casualty insurer estimated a loss of 145 billion yen for the year to March on claims linked to Thai floods. The company also said expiry of deferred tax assets also contributed to the loss.

The company earlier estimated a 6 billion yen profit and it now estimated a payout of 236 billion yen.

Komatsu Ltd decreased 1 yen to 2,125 yen, Hitachi Construction Machinery Co increased 7 yen to 1,489 yen and Toyo Engineering Corp rose 3 yen to 317 yen.

Softbank Corp closed down 4 yen at 2,378 yen, KDDI Corp closed down 0.8% to 491,500 yen and NTT DoCoMo, Inc closed up 700 yen to 136,500 yen.