Nikkei in Cautious Advance, Japanese Machinery Orders Up 5.4%

Nigel Thomas
13 Jun, 2012
New York City

Stocks in Tokyo traded higher in cautious trading supported by the purchases from Bank of Japan. Calendar of meetings dominated market sentiment and investors sought safety in defensive stocks. Machinery orders in Japan rose 5.7% in April.

[R]6:30 PM Tokyo – Stocks in Tokyo traded higher in cautious trading supported by the purchases from Bank of Japan. Calendar of meetings dominated market sentiment and investors sought safety in defensive stocks. Machinery orders in Japan rose 5.7% in April.[/R]

Stocks in Tokyo trading gained in a subdued trading as investors stay on the sidelines ahead of meetings of central bankers and political leaders.

The calendar of activities for the next two weeks dominated market sentiment as traders await results of Greek election on Sunday and the meeting of G20 leaders June 20.

Investors are also looking for a direction from policy makers at meetings of Bank of Japan and Federal Reserve.

Prime Minister Yoshihiko Noda removed five of the 18 members of his cabinet ahead of the unpopular bill to raise national sales tax this summer and win the support of the largest opposition party. Japan is struggling to contain the rising cost of pension and social security costs and many of his own party members are resisting the change.

The Nikkei 225 Stock Average increased 51.12 to 8,587.84 and the broader Topix index rose 2.07 to 726.44. The yen in Tokyo closed at 79.64 against one dollar.

Trading volume in Tokyo was one third lower than average as investors took cautious view of the market ahead of Greek elections this weekend. Bank of Japan confirmed that purchased 26.3 billion yen worth of exchange traded funds on Tuesday to support the stock market.

Stock Movers

Kansai Electric Power Company, Inc unchanged to 1,045 yen and Tokyo Electric Power unchanged to 159 yen.

Chubu Electric Power rose 0.7%, Shikoku Electric Power Co added 0.2% and Hokkaido Electric Power up by 0.2%.

Toyota Motor increased 15 yen to 3,050 yen and Honda Motor Co. closed up at 12 yen to 2,546 yen and Nissan Motor Co Ltd decreased 9 yen to 750 yen.

Sony Corp slides 4 yen to close at 1,021 yen and rebounded for the second day from the 32-year low and Panasonic Corp closed down at 4 yen to 553 yen. Toshiba unchanged to 297 yen.

Olympus Corp rose 4 yen to 1,242 yen, Nikon closed up at 52 yen to 2,292 yen and Fanuc Ltd gained 50 yen to 13,580 yen. Canon Inc declined 35 yen to 3,215 yen.

Hitachi Ltd increased 11 yen to 476 yen on reports that the company is looking to complete the purchase of Germany based power plant service provider Xervon Energy GmbH for several billion yen.

Machinery orders rose 5.4% in Japan according to the data release from the Cabinet Office.

Komatsu Ltd slumped 21 yen to 1,879 yen, Hitachi Construction Machinery Co rose 3 yen to 1,478 yen. Fanuc added 0.4% to 13,580 yen.

Inpex Corp inched slipped 2% to 441,000 yen and Japan Petroleum Exploration Co. declined 24 yen to 2,935 yen.

Mitsui O.S.K. Lines, Ltd rose 4 yen to 279 yen; Kawasaki Kisen Kaisha, Ltd unchanged to 148 yen and Nippon Yusen K.K. added 2 yen to 209 yen.

Fast Retailing Co. gained 280 yen to 15,500 yen and J. Front Retailing Co. Ltd increased 6 yen to 369 yen as investors begin to factor in the long term impact of higher sales tax.

Mitsubishi UFJ Financial Group rose 1 yen to 348 yen and Sumitomo Mitsui Financial Group increased 7 yen to 2,371 yen. Nomura Holdings, Inc fell 1 yen to 264 yen.

Credit Saison Co Ltd decreased 7 yen to 1,523 yen.

Tokyo Tatemono Co., Ltd fell 1 yen to 274 yen and Mitsui Fudosan declined 21 yen to 1,356 yen and Sumitomo Realty & Development Co. added 5 yen to 1,705 yen.

Nippon Steel rose 6 yen to 173 yen and JFE Holdings Inc increased 8 yen to 1,277 yen.