Weaker Yen Fails to Lift Net at Fanuc, Honda and Ricoh; Nomura Surges

Hiruki Nakamura
30 Apr, 2013
New York City

The Nikkei index slipped a fraction after Fanuc, Honda Motor and Ricoh reported weaker than expected earnings and failed to yen estimate for the fiscal year earnings. Corporate Japan is sending signals to policymakers that weaker yen may be harder to sustain.

[R]5:30 PM Tokyo – The Nikkei index slipped a fraction after Fanuc, Honda Motor and Ricoh reported weaker than expected earnings and failed to yen estimate for the fiscal year earnings. Corporate Japan is sending signals to policymakers that weaker yen may be harder to sustain.[/R]

Stocks in Tokyo traded lower after Honda Motor, Fanuc and Ricoh reported weaker than expected earnings.

Investors are cautious as the earnings season rolls and the market indexes have surged nearly 50% in the last five months. The weaker yen has not translated to higher earnings for most companies so far and investors are beginning to dial back expectations.

Many Japanese companies have diversified production across the world limiting the impact of strong yen but when the trend reverses the positive contribution to the yen also is smaller.

The yen declined to 97.74 against one dollar.

The Nikkei 225 Stock Average slipped 23.27 or 0.2% to 13,860.86 and the broader Topix Index gained 3.94 to 1,165.13.

For the April month, Nikkei surged 11.8%.

Stocks in Review

Nomura Holdings increased after the largest brokerage firm reported its best quarterly profit in seven years on higher fees and commissions and recorded a gain on the sale of property affiliate.

Nomura said net income increased to 82.4 billion yen for the quarter ending in March compared to 22.1 billion yen.

Nomura climbed 4.1% to 793 yen and Dai-Ichi Life Insurance gained 1.9%. Mitsui Fudosan rose 0.3% and Mitsubishi Estate Co increased 0.6%.

Toyota Motor Corp slumped 70 yen to 5,640 yen and Honda Motor Co. dropped 135 yen to 3,875 yen and Nissan Motor Co Ltd slid 18 yen to 1,016 yen.

Honda Motor Co, traded the most on the main board, after the automaker reported operating profit that fell short of expectations.

Yamaha Motor Co Ltd fell 21 yen to 1,358 yen. Mitsubishi Motors Corp closed unchanged at 115 yen.

Nippon Steel closed unchanged at 259 yen and JFE Holdings Inc up 31 yen to 2,108 yen.

Sony lowered 18 yen to 1,613. Canon Inc slipped 65 yen to 3,495 yen and Nikon fell 37 yen to 2,118 yen. TDK Corp added 20 yen to 3,560 yen. NEC plunged 18 yen or 6.6% to 253 yen.

Nintendo Co. Ltd climbed 170 yen to 10,720 yen.

Ricoh plunged 8.4% to 1,086 yen after the office equipment maker reported net income of 32.5 billion yen in the year ending in March.

Fanuc plunged after the robot maker reported 17% decline in operating profit in the year ending in March and estimated a decline in the first-half sales and operating earnings of 62 billion yen.

Fanuc is the second most weighted stock in the Nikkei index.

Fanuc Corp. plummeted 870 yen or 5.6% to 14,700 yen and Komatsu Ltd rose 4 yen to 2,659 yen. Hitachi Construction Machinery Co fell 15 yen to 2,312 yen.

Softbank Corp jumped 55 yen to 4,825 yen.

FamilyMart Co Ltd, the convenience chain operator climbed 75 yen to 4,455 yen and Lawson advanced 140 yen to 7,680 yen. Ito En Ltd gained 35 yen to 2,345 yen.

Seven & I Holdings Co rose 40 yen to 3,740 yen. Fast Retailing Co. closed unchanged at 35,700 yen and J. Front Retailing Co. Ltd added 1 yen to 818 yen.

Mitsubishi UFJ Financial Group up 3 yen to 663 yen and Sumitomo Mitsui Financial Group rose 15 yen to 4,605 yen. Dai-Ichi Life gained 1.9% to 134,000 yen. Nomura Holdings, Inc climbed 31 yen to 793 yen.

Mitsui O.S.K. increased 4% to 405 yen after it estimated a net profit of 50 billion yen in the current fiscal year on the weaker yen is expected to increase income from dollar-based contracts.