Yen Strength Worries Finance Ministry, Aderans in $163 Million Deal

Nigel Thomas
17 Jul, 2012
New York City

Tokyo financial markets closed higher after a 3-day weekend and the yen strengthened prompting another round of tough talks from the finance minister. The IMF lifted its outlook for Japan to 2.4% but cut global economic views.

[R]7:00 PM Tokyo – Tokyo financial markets closed higher after a 3-day weekend and the yen strengthened prompting another round of tough talks from the finance minister. The IMF lifted its outlook for Japan to 2.4% but cut global economic views.[/R]

Stocks in Tokyo traded higher after a 3-day weekend and investors kept their focus on domestic companies.

The stocks were under pressure at the opening on the worries that the European nations are still struggling to contain the debt contagion and the I.M.F. lowered its assessment of the global economic outlook.

The Nikkei 225 Stock Average increased 30.88 to 8,755 and the broader Topix index fell 2.96 to 743.38.

The yen traded down to 78.84 against one dollar.

Finance Minister Jun Azumi noted the recent strength in the yen and said, “We can see signs that speculation is behind recent yen gains” and added “sudden yen gains or excessive currency moves could harm the economy.”

He went on to add that we will “carefully watch the market” and “will take firm measures” on currencies when needed.

The IMF left its outlook for the current year economic growth at 3.5% and trimmed 2013 forecast to 3.9% growth from 4.1%.

The global lender also trimmed the UK outlook for this year to 0.2% from the previous estimate in April of 0.8%, held its forecast of 0.3% contraction for the euro zone, trimmed growth in China to 8% from 8.2% and for India to 6.1% from 6.9%.

The IMF lifted its outlook for Japan to 2.4% from 2% but cut its view for the next year to 1.5% from 1.7%.

The IMF also shaved the U.S. outlook for the current year to 2% from 2.1% but warned that the looming disagreement among politicians may slowdown the economy further and to “mitigate the risks of financial market disruptions” policymakers must act well ahead of the deadline in October.

Stock Movers

Dentsu Inc fell 2 yen to 2,143 yen on the ongoing worries that the company may have overplayed its hand in acquiring the UK based advertising group.

Toyota Motor declined 21 yen to 2,989 yen after a U.S. senator said to federal regulators that the agency did not go far enough in investigating the electronics linked acceleration incidents.

Honda Motor Co. slumped 20 yen to 2,468 yen and Nissan Motor Co Ltd decreased 11 yen to 700 yen.

Canon Inc fell 3% to 2,878 yen. , Seiko Epson Corp dropped 7.4% to 627 yen and Ricoh Co Ltd fell 4% to 562 yen after U.S. based printer maker Lexmark said its European sales are weaker than expected.

Sony Corp dropped 34 yen to 964 yen and Panasonic Corp slumped 20 yen to 540 yen. Toshiba slipped 6 cents to 275 yen. Olympus Corp advanced 68 yen to 1,354 yen and Nikon declined 47 yen to 2,255 yen.

Fanuc Ltd closed up 130 yen at 12,540 yen, Komatsu Ltd dropped 25 yen to 1,726 yen and Hitachi Construction Machinery Co gained 14 yen to 1,360 yen.

Aderans Co Ltd increased 10 yen to 986 yen after the wig maker agreed to acquire for $163 million in cash hair loss unit of hair salon operator Regis Corp.

Yamada Denki added 0.4% to 3,640 yen. Nitori Holdings Co closed down 0.5% to 7,640 yen, apparel retailer Shimamura increased 1.6% to 9,550 yen and Sagami Co slid 1.8% to 106 yen.

Marushohotta Co rose 1 yen to 46 yen and Edion Corp fell 0.8% to 359 yen.

Fast Retailing Co. advanced 730 yen to 16,060 yen and J. Front Retailing Co. Ltd increased 10 yen to 425 yen.

Kajima Corp rose 2 yen to 233 yen and Taisei Corp up 2 yen to 224 yen. Sekisui House Ltd added 0.5% to 766 yen and Daito Trust Construction Co Ltd rose 1.3% to 7,670 yen.

Tokyo Tatemono Co., Ltd gained 4 yen to 282 yen and Mitsui Fudosan advanced 34 yen to 1,489 yen and Sumitomo Realty & Development Co. increased 41 yen to 1,895 yen.

Kansai Electric Power Company, Inc dropped 63 yen to 809 yen and Tokyo Electric Power decreased 16 yen to 123 yen.

Inpex Corp rose 0.1% to 435,500 yen and Japan Petroleum Exploration Co. slid 24 yen to 2,923 yen.

Mitsui O.S.K. Lines, Ltd slipped 6 yen to 242 yen; Kawasaki Kisen Kaisha, Ltd unchanged to 122 yen and Nippon Yusen K.K. decreased 5 yen to 179 yen.

Mitsubishi UFJ Financial Group rose 2 yen to 377 yen and Sumitomo Mitsui Financial Group slipped 4 yen to 2,523 yen. Nomura Holdings, Inc added 3 yen to 269 yen.

Credit Saison Co Ltd advanced 25 yen to 1,812 yen.

Nippon Steel slid 7 yen to 157 yen and JFE Holdings Inc dropped 63 yen to 1,090 yen.