Sales Tax Decision Awaited in Japan, Real Estate Stocks Gain

Hiruki Nakamura
26 Aug, 2013
New York City

Stocks in Tokyo closed lower in choppy trading as investors awaited more reforms and clarity on the widely expected and unpopular move to increase sales tax. Builders and real estate companies were in focus ahead of Summer 2020 Olympics meeting in two weeks.

[R]4:30 PM Tokyo – Stocks in Tokyo closed lower in choppy trading as investors awaited more reforms and clarity on the widely expected and unpopular move to increase sales tax. Builders and real estate companies were in focus ahead of Summer 2020 Olympics meeting in two weeks.[/R]

Stocks in Tokyo closed lower in choppy trading as investors debated the possible timetable for the sales tax increase implementation.

A diverse panel of regulators, academics, and business leaders began their meeting today to discuss the impact of an increase in sales tax on the Japanese economy.

Prime Minister Shinzo Abe is expected to announce new reform measures in October including an increase in sales tax.

The sales tax increase is not popular among voters but most foreign investors have already factored the move.

Prime Minister Abe is scheduled to shed more light on the tax and the reform move ahead of the Asia-Pacific Economic Cooperation meeting in Indonesia on October 7.

Construction companies and real estate operators were in focus ahead of International Olympics Committee meeting on September 7 in Buenos Aires, Argentina.

Japan is bidding for Summer 2020 Olympics and the Asian nation is one of the three countries in the lead.

The Nikkei 225 Stock Average slid 24.27 to 13,636.28 and the Topix fell 1.63 to 1,140.

The yen fell to 99.14 against one dollar, the lowest since August 1.

Stocks in Review

Mitsubishi Estate increased 1.5%, Taisei Corp added 2% and Sumitomo Realty & Development Co increased 3%.

Toyota Motor Corp slipped 10 yen to 6,210 yen and Honda Motor Co. gained 5 yen to 3,735 yen. Nissan Motor Co Ltd fell 5 yen to 1,023 yen.

Sony jumped 15 yen to 1,981 yen.

Softbank Corp dropped 30 yen to 6,270 yen and Fast Retailing Co. slid 150 to 31,750 yen.

NTT DoCoMo Inc jumped 2% on media speculation that the wireless telecom operator is likely to begin selling popular iPhone made by Apple Inc.

Sharp Corporation slipped 1.2% to 399 yen and the Germany-based OSRAM GmbH entered into an agreement about the cross licensing of patents that covers light-emitting diodes and laser diodes.