Nikkei Closes Higher in Volatile Trading, Dentsu Down 7%

Nigel Thomas
13 Jul, 2012
New York City

Stocks in Tokyo edged higher after China reported a raft of economic data that at least for now push aside the prospect of a global economic slowdown. Japan revised its industrial output rate to 3.4% in May. Dentsu 7% dropped on the worries that it may have overpaid for the Aegis purchase.

[R]7:00 PM Tokyo – Stocks in Tokyo edged higher after China reported a raft of economic data that at least for now push aside the prospect of a global economic slowdown. Japan revised its industrial output rate to 3.4% in May. Dentsu dropped on the worries that it may have overpaid for the Aegis purchase.[/R]

Stocks in Tokyo gained for the first time in seven days after China reported a raft of economic data that met expectations.

China''s gross domestic product expanded 7.6% annually in the second quarter, following the 8.1% growth recorded in the first quarter, the National Bureau of Statistics said today.

Separately, the statistics office reported that growth in China''s industrial production eased unexpectedly to 9.5% in June from 9.6% in May.

Japan''s industrial output fell at a revised 3.4% monthly rate in May compared to the 3.1% decline estimated initially, according to a government report. The output declined 0.2% rate in April.

Capacity utilization index declined 2.2 percent rate in May from the previous month to 89.8.

China also reported a raft of other economic data that offered a mixed but slowing economic outlook. Retail sales in the quarter were 13.7% compared to 13.8% in the previous quarter.

New property construction in the first half fell to 7.1% and total value of all new homes sold declined 6.5% to 1.9 trillion yuan or $232 billion.

Separately, South Korea''s central bank lowered the growth outlook for the economy. The Bank of Korea lowered the estimate of gross domestic product growth to 3% from the estimate of 3.5% rise in April.

Yesterday, the central bank cut the key interest rate by 25 basis points to 3% from 3.25%.

Singapore’s economy shrank in the second quarter unexpectedly by 1.1% from the previous quarter, when it grew 9.4%, according to the Trade and Industry Ministry. Manufacturing reversed its earlier growth of 21% in the previous quarter to a 6% decline.

The Nikkei 225 Stock Average rose 4.11 to 8,724.12 and the broader Topix index fell 1.15 to 746.34.

Stock Movers

Dentsu Inc plunged 7% or 161 yen to 2,145 yen after investors worried that the advertising agency may have paid too much for its latest UK acquisition and the company may have to increase its debt to complete the transaction.

Toyota Motor declined 15 yen to 3,010 yen and Honda Motor Co. slumped 22 yen to 2,488 yen and Nissan Motor Co Ltd added 3 yen to 711 yen.

Sony Corp fell 1 yen to 998 yen and Panasonic Corp gained 4 yen to 560 yen. Toshiba fell 2 cents to 281 yen. Olympus Corp advanced 26 yen to 1,286 yen and Nikon increased 17 yen to 2,302 yen.

Fanuc Ltd closed up 300 yen at 12,410 yen and Canon Inc declined 34 yen to 2,971 yen.

Machinery makers traded higher after China reported GDP, retail sales and industrial production data that met most analysts estimates.

Komatsu Ltd increased 17 yen to 1,751 yen and Hitachi Construction Machinery Co gained 17 yen to 1,346 yen.

Yamada Denki added 1.7% to 3,625 yen. Nitori Holdings Co closed up 2.8% at 7,680 yen, apparel retailer Shimamura fell 0.3% to 9,400 yen and Sagami Co slipped 4.4% to 108 yen.

Marushohotta Co fell 1 yen to 45 yen and Edion Corp added 0.8% to 362 yen.

Fast Retailing Co. gained 40 yen to 15,330 yen and J. Front Retailing Co. Ltd slipped 12 yen to 415 yen.

Kajima Corp fell 1 yen to 231 yen and Taisei Corp rose 2 yen to 222 yen. Sekisui House Ltd rose 0.4% to 762 yen and Daito Trust Construction Co Ltd added 1.1% to 7,570 yen.

Tokyo Tatemono Co., Ltd rose 2 yen to 278 yen and Mitsui Fudosan slid 9 yen to 1,453 yen and Sumitomo Realty & Development Co. increased 9 yen to 1,854 yen.

Kansai Electric Power Company, Inc dropped 29 yen to 872 yen and Tokyo Electric Power decreased 7 yen to 139 yen.

Inpex Corp fell 0.2% to 435,000 yen and Japan Petroleum Exploration Co. slipped 14 yen to 2,947 yen.

Mitsui O.S.K. Lines, Ltd slid 5 yen to 248 yen; Kawasaki Kisen Kaisha, Ltd fell 3 yen to 122 yen and Nippon Yusen K.K. decreased 5 yen to 184 yen.

Mitsubishi UFJ Financial Group slipped 4 yen to 375 yen and Sumitomo Mitsui Financial Group slumped 19 yen to 2,527 yen. Nomura Holdings, Inc fell 3 yen to 266 yen.

Credit Saison Co Ltd advanced 35 yen to 1,787 yen.

Nippon Steel unchanged to 164 yen and JFE Holdings Inc gained 11 yen to 1,153 yen.