Japan's November Trade Deficit Surges

Hiruki Nakamura
18 Dec, 2013
New York City

Stocks in Tokyo surged on the expectations of details of economic reform as early as this week. Japan

[R]4:30 PM Tokyo – Stocks in Tokyo surged on the expectations of details of economic reform as early as this week. Japan’s trade deficit in November surged to a record as fuel imports.[/R]

Stocks in Tokyo surged on the expectations that Prime Minister Abe will announce this week details of his economic stimulus plan.

The third arrow of Abe’s economic reform is expected to provide labor markets reform, government spending improvement and tax reform.

The Nikkei 225 Stock Average jumped 292.49 or 1.9% to 15,571.12 and the Topix gained 18.18 or 1.5% to 1,250.49.

The yen closed at 103.01 against one dollar.

Record November Trade Deficit

Japan’s trade deficit surged to a record in November as fuel import soared. The November deficit was the largest for that month, since the record keeping began in 1979, 17th monthly deficit in a row.

Weaker yen also weighed on the deficit.

Ministry of Finance said trade deficit widened to 1.292 trillion yen in November followed by downwardly revised deficit of 1.092 trillion yen in October.

Overall exports to China rose 33% and to the U.S. increased 21%.

Exports from Japan surged 18.4% from a year earlier led by increase in automobile shipments to the U.S. and China. Exports in November rose for the ninth month in a row. Exports rose 18.6% in October.

Imports climbed record 21.1% from a year ago.

Chief executive officer Atsushi Saito of Tokyo Stock Exchange said the exchange plans to start nighttime trading from early next year to provide trading opportunities to foreign investors after 3 p.m. Tokyo time.

Stocks in Review

Toyota Motor Corp jumped 100 yen to 6,200 yen. Honda Motor Co climbed 125 yen to 4,215 yen.

Nissan Motor Co Ltd advanced 25 yen to 890 yen after the automobile company resurrected its Datsun brand in Russia from April and expects to lure first-time buyers away from the used car market to its 400,000 rouble or $12,100 model.

Nissan retired the Datsun brand in 1981 but plans to re-launch in Indonesia, India, Russia and South Africa.

Sony rose 5 yen to 1,780 yen after the electronic products maker on reports that the company is looking to sell its Gracenote audio-recognition software business.

Softbank Corp advanced 160 yen to 8,930 yen. Fast Retailing Co increased 1,050 yen to 39,000 yen.

Hitachi Power Systems America, Ltd, the diversified company signed agreement with American Electric Power to supply Selective Catalytic Reduction catalyst under a blanket contract. Financial terms were not disclosed.

Mitsubishi Corporation rose 0.6% to 1,950 yen and the Japan-based trading company plans to invest 10% stake in Yetagun Gas Field Project in Myanmar from Nippon Oil Exploration (Myanmar) Limited.

Panasonic Corporation gained 1.1% to 1,183 yen after the Japan-based electronics products maker plans to hire 700 new graduates in Japan in fiscal 2015, twice the fiscal 2014.

Panasonic also signed an agreement to transfer its 900 patents and applications from Panasonic Automotive & Industrial Systems Co., one of Panasonic''s internal companies to Wi-LAN, a new subsidiary.

Ricoh Co Ltd declined 4.7% to 1,070 on media reports that the office and industrial equipment maker may struggle to achieve its third-quarter operating profit target.

Suzuki Motor Corporation climbed 2.8% to 2,719 yen after the Japan-based mini-car maker plans to launch a new lightweight car and significantly improve the fuel economy.

Sumitomo Mitsui Construction Co Ltd slid 0.9% to 114 yen after the construction company aims to win orders worth 4 billion yen in the Southeast Asian country through March 2016 as demand for building roads, railways and other infrastructure increase.

Tokyo Electric Power Co Inc closed unchanged at 535 yen after the electric power supplier said it will decommission two reactors at the troubled site of Fukushima Daiichi power plant. The plant had total six reactors when a record 9-magnitude earthquake struck on March 11, 2011.

Tepco estimated that the clean-up and compensation will require at least 11 trillion yen and by the end of December the debt is expected to reach 4.5 trillion yen.