BoJ $1.4 Trillion Spending May Leak to U.S. and European Treasury Bonds

Hiruki Nakamura
10 Apr, 2013
New York City

Stocks in Japan traded higher and the yen extended weakness against the dollar and the yen. Investors are worried that most of the $1.4 trillion in central bank spending will leak to the U.S. and European bond markets and inflate real estate prices around the world.

[R]5:30 PM Tokyo – Stocks in Japan traded higher and the yen extended weakness against the dollar and the yen. Investors are worried that most of the $1.4 trillion in central bank spending will leak to the U.S. and European bond markets and inflate real estate prices around the world.[/R]

Stocks in Tokyo closed higher and the two widely followed indexes inched near to five-year highs.

The yen traded at 99.55 before against one dollar and inched towards the 100 yen level last seen in April 2009 and hovered near 130.09 to a euro level.

The Nikkei 225 Stock Average climbed 95.78 or 0.7% to 13,288.13 and the broader Topix Index gained 19 to 1,121.04.

Investors are increasingly factoring weaker yen and looking at the next critical 110 yen to a dollar level as the central bank reflates the economy with aggressive $1.4 trillion spending by 2014 to revive prices.

Separately, China reported March exports increased 10% from a year ago and imports increased 14.1% with a trade deficit of $880 million. Exports increased 21.8% in February.

Stocks in Review

Universal Entertainment Corp plunged 16% to 1,666 yen after the casino operator Chairman Kazuo Okada is facing criminal investigation related to Philippine casino project.

Toyota Motor Corp jumped 60 yen to 5,330 yen and Honda Motor Co. rose 35 yen to 3,825 yen and Nissan Motor Co Ltd gained 12 yen to 999 yen. Yamaha Motor Co Ltd climbed 50 yen to 1,339 yen. Mitsubishi Motors Corp added 3 yen to 104 yen.

Nippon Steel increased 17 yen to 251 yen and JFE Holdings Inc soared 77 yen or 4.1% to 1,977 yen.

Sony rose 15 yen to 1,658. Canon Inc climbed 70 yen to 3,545 yen and Nikon jumped 69 yen to 2,199 yen. TDK Corp soared 135 yen or 4.1% to 3,390 yen. NEC added 9 yen to 260 yen.

Nintendo Co. Ltd surged 1,240 yen or 11.7% to 11,880 yen.

Fanuc Corp. jumped 90 yen to 15,250 yen and Komatsu Ltd gained 39 yen to 2,390 yen. Hitachi Construction Machinery Co increased 49 yen to 2,230 yen.

Softbank Corp declined 155 yen to 4,660 yen.

FamilyMart Co dropped after the convenience chain operator estimated weaker-than-expected earnings in the current fiscal year.

FamilyMart Co Ltd, the convenience chain operator plunged 390 yen or 8.1% to 4,405 yen and Lawson dropped 220 yen to 7,630 yen. Ito En Ltd gained 8 yen to 2,397 yen.

Seven & I Holdings Co jumped 90 yen to 3,605 yen. Fast Retailing Co. declined 250 yen to 33,500 yen and J. Front Retailing Co. Ltd slumped 38 yen or 4.6% to 787 yen.

Mitsubishi UFJ Financial Group soared 31 yen or 4.9% to 655 yen and Sumitomo Mitsui Financial Group surged 290 yen or 6.7% to 4,620 yen. Dai-Ichi Life climbed 3.5% to 121,700 yen. Nomura Holdings, Inc jumped 41 yen or 6.2% to 702 yen.