Nikkei Soars 2% in Nervous Market Sentiment

Nigel Thomas
06 Aug, 2012
New York City

Stocks in Tokyo surged following the market advance last week in Europe and New York. Taiwan based Hon Hai Precision said it does not have to carry out investment in Sharp after the latest price volatility. Nippon Sheet Glass Co Ltd extended losses for the second day.

[R]7:00 PM Tokyo – Stocks in Tokyo surged following the market advance last week in Europe and New York. Taiwan based Hon Hai Precision said it does not have to carry out investment in Sharp after the latest price volatility. Nippon Sheet Glass Co Ltd extended losses for the second day.[/R]

Stocks in Tokyo soared following the gains in New York and sharp upsurge in European markets on Friday.

Investors bid up export sensitive stocks after better than expected net U.S. jobs additions in July. Tokyo investors always more sensitive to the U.S. developments returned to add more exposure to trading companies and auto and electronics makers.

Investors looked ahead to economic data release from China later in the week and another week of earnings release from banks and tech companies and the conclusion of a Bank of Japan policy meeting on Thursday.

However, stocks remained volatile and several stocks that dropped more than 5% last week rebounded in a choppy trading today. Fanuc, Toyota and Komatsu rebounded between 1.5% and 6%.

U.S. indexes gained after non-farm payrolls rose more than estimated in July but not enough to prevent the increase in the unemployment rate to a five-month high of 8.3%. The early gains in New York also lifted markets in Europe more than 2.5% and the indexes in Spain and Italy soared 6%.

The Nikkei 225 Stock Average climbed 171.18 or 2% to 8,726.29 and the broader Topix index increased 11.79 or 1.6% to 735.73.

In trading, turnover improved to 1.84 billion shares from 1.78 billion shares on Thursday.

Stock Movers

Toyota Motor advanced 75 yen to 3,140 yen after it reported quarterly earnings increased to a 4-year high.

Honda Motor Co. increased 67 yen to 2,470 yen and Nissan Motor Co Ltd gained 16 yen to 754 yen after U.S. monthly sales increased more than expected.

Canon Inc advanced 94 yen to 2,788 yen, Seiko Epson Corp rose 0.6% to 506 yen and Ricoh Co Ltd soared 5.1% to 598 yen. Sony Corp closed unchanged at 897.

Panasonic Corp gained 7 yen to 571 yen, Toshiba increased 7 yen to 260 yen and Nikon advanced 84 yen to 2,199 yen.

Sharp declined 5.7% to 181 yen and traded at a 3-decade low after it estimated annual loss of 250 billion yen and Taiwan based Hon Hai Precision Industry said it did not have to follow through its offer to invest in the company at 550 yen a share after the recent stock price volatility.

Sharp plummeted to the low last since 1976 and announced its first layoff in nearly sixty years.

Nintendo Co. Ltd fell 0.1% to 8,330 yen and Fujitsu rose 0.7% to 304 yen.

Fanuc Ltd advanced 570 yen or 4.9% to 12,150 yen, Komatsu Ltd gained 26 yen to 1,647 yen and Hitachi Construction Machinery Co increased 40 yen to 1,395 yen.

Nippon Sheet Glass Co Ltd extended losses on the second day in a row by 6.7% today to 56 yen after it lowered full-year sales estimate by 5%.

Yamada Denki increased 1.6% or 65 yen to 3,945 yen. Nitori Holdings Co closed unchanged at 7,540 yen, apparel retailer Shimamura dropped 0.7% to 8,990 yen and Sagami Co rose 3 yen to 103 yen.

Fast Retailing Co. gained 350 yen to 16,650 yen after same store sales declined less than estimated and J. Front Retailing Co. Ltd closed up 8 yen at 390 yen.

Kajima Corp up 3 yen to 218 yen and Taisei Corp rose 3 yen to 214 yen. Sekisui House Ltd added 4 yen to 732 yen and Daito Trust Construction Co Ltd gained 0.8% to 7,810 yen.

Tokyo Tatemono Co., Ltd raised 3 yen to 282 yen and Mitsui Fudosan increased 29 yen to 1,546 yen and Sumitomo Realty & Development Co. gained 30 yen to 1,995 yen.

Kansai Electric Power Company, Inc added 7 yen to 585 yen.

Inpex Corp advanced 4.1% to 445,500 yen and Japan Petroleum Exploration Co. increased 66 yen to 2,912 yen.

Mitsui O.S.K. Lines, Ltd added 5 yen to 218 yen, Kawasaki Kisen Kaisha, Ltd rose 3 yen to 109 yen and Nippon Yusen K.K. gained 5 yen to 170 yen.

Mitsubishi UFJ Financial Group raised 5 yen to 375 yen and Sumitomo Mitsui Financial Group increased 29 yen to 2,519 yen. Nomura Holdings, Inc gained 11 yen to 279 yen.

Tokio Marine advanced 39 yen to 1,806 yen and Mito Securities rose 2.2% to 137 yen.

Credit Saison Co Ltd increased 39 yen to 1,819 yen.

Nippon Steel rose 2 yen to 153 yen and JFE Holdings Inc gained 7 yen to 995 yen.