Optimism Lifts Nikkei to 32-Month High, Yen Gains Trimmed

Nigel Thomas
15 Jan, 2013
New York City

Nikkei index in Tokyo closed at a 32-month high and the yen declined further prompting comments from Economics Minister Amari. The yen traded at a new 26-month low and markets are anticipating revised inflation target at the BoJ meeting next week.

[R]7:00 PM Tokyo – Nikkei index in Tokyo closed at a 32-month high and the yen declined further prompting comments from Economics Minister Amari. The yen traded at a new 26-month low and markets are anticipating revised inflation target at the BoJ meeting next week.[/R]

The Nikkei index extended gains and closed at a 32-month high after investors held out for monetary policy action on the next Bank of Japan meeting on January 21.

The benchmark index has gained 26% in last two months and jumped at a new high on the hopes that the recently elected Prime Minister Shinzo Abe will follow through his promise of fiscal measures.

Shinzo called for “bold policy leadership” during the three-day market closure and expectations are high that new governor may be appointed in April at the Bank of Japan.

The Nikkei 225 Stock Average climbed 77.51 or 0.7% to 10,879.08 and the broader Topix Index jumped 7.53 to 906.22.

The yen dropped as low of 89.95 against one dollar, a 2-1/2 year low and capped gains after Economics Minister Akira Amari said that excessive yen weakness could lift prices and affect consumers.

Amari added at a news conference that market forces has adjusted the yen has adjusted to appropriate level and further weakness could affect prices paid by consumers.

Stocks in Review

Electronics components and parts makers declined after Nikkei said Apple may have overestimated demand for its popular iPhone 5 and trimmed orders for LCD displays.

Sharp Corp declined 2.7% and Foster Electric Co Ltd fell 1.5%.

Toyota Motor Corp. gained 5 yen to 4,265 yen and Honda Motor Co. closed unchanged at 3,380 yen and Nissan Motor Co Ltd increased 10 yen to 883 yen. Mazda Motor Corp added 5 yen 209 yen.

Nippon Steel up 3 yen to 226 yen and JFE Holdings Inc slumped 6 yen to 1,672 yen.

Shimano Inc jumped 150 yen to 5,940 yen.

Sony Corp increased 12 yen to 995, Canon Inc gained 20 yen to 3,390 yen and Nikon dropped 60 yen to 2,661 yen.

Nintendo Co. Ltd slipped 40 yen to 9,020 yen and Pioneer Corp. up 1 yen to 229 yen.

Fanuc Corp. declined 530 yen to 15,100 yen and Komatsu Ltd climbed 45 yen to 2,375 yen. Hitachi Construction Machinery Co advanced 34 yen to 1,936 yen. Sharp Corp decreased 9 yen to 321 yen.

Softbank Corp jumped 15 yen to 3,035 yen.

Olympus surged 8% to 1,935 yen after Goldman Sachs lifted its rating on the stock and cited rising sales of camera.

FamilyMart Co Ltd, the convenience chain operator dropped 35 yen to 3,575 yen and Lawson slumped 30 yen to 6,150 yen. Ito En Ltd added 2 yen to 1,681 yen.

Seven & I Holdings Co increased 26 yen to 2,640 yen. Fast Retailing Co. jumped 180 yen to 23,820 yen and J. Front Retailing Co. Ltd gained 9 yen to 508 yen.

Mitsubishi UFJ Financial Group up 4 yen to 483 yen and Sumitomo Mitsui Financial Group added 5 yen to 3,335 yen.

Nomura Holdings, Inc increased 4 yen to 494 yen on the worries that the stock has run ahead of its fundamentals.

Mitsui O.S.K. Lines, Ltd climbed 11 yen to 291 yen and Nippon Yusen K.K. jumped 8 yen to 224 yen.