Nikkei Scales Another 15-Year High; Hitachi, Asahi Kasei and Sosei in Deals

Hiruki Nakamura
24 Feb, 2015
New York City

Nikkei soared to a new 15-year high. Hitachi agreed with Italy-based conglomerate Finmeccanica to acquire its train and signal making units for $2 billion. Asahi Kasei, the chemical and fiber maker plans to acquire the U.S. based Polypore International Inc''s energy storage segment for $2.2 billion.

[R]4:30 PM Tokyo – Nikkei index soared to a new 15-year high. Hitachi agreed with Italy-based conglomerate Finmeccanica S.p.A to acquire its train and signal making units for $2 billion. Asahi Kasei Corp, the chemical and fiber maker plans to acquire the U.S. based Polypore International Inc''s energy storage segment for $2.2 billion.[/R]

Market indexes in Tokyo continued to advance and the widely followed Nikkei index closed up to a new 15-year high.

Investors speculated ahead of U.S. Federal Reserve Chairman Janet Yellen’s speech as the expectation of interest rate to begin rising in the second-half drove the market sentiment.

Yellen is expected to testify before Congress later today and investors are looking for clues in when the central bank is expected to raise rates.

However, in the past what the central bank does has mattered more than what the policy makers say in the public forum which are designed largely for politicians to make their talking points with little consequences for the policy.

On the economic front, index measuring corporate service prices in January jumped 3.4% to 102.3 and unchanged from December, the Bank of Japan said today.

The Nikkei 225 Stock Average increased 136.56 or 0.7% to 18,603.48 and the broader Topix index gained 5.45 to 1,508.28.

The yen traded higher at 119.53 against one dollar.

Stocks in Review

Asahi Kasei Corp slipped 1.1% to 1,217 yen after the chemical and fiber maker plans to acquire through a U.S. subsidiary, Polypore International Inc''s energy storage segment for $60.50 per share in cash or $2.2 billion, approximately 24% premium to previous day close.

Casio Computer Co Ltd climbed 4% to 2,090 yen after the Nikkei reported the consumer electronic maker plans to expand production of its high-end luxury wristwatches with a selling price of more than 100,000 yen.

Dentsu Inc gained 1.2% to 5,120 yen after the advertising and marketing service provider said in its annual report that the national advertising expenditure for the fiscal 2014 jumped 2.9% to 6,152.2 billion yen, an increase for the first time in six years.

The company added Internet advertising market surged 12.1% to 1,000 billion yen while advertising spending in newspaper and magazines segment dropped 1.8% but in radio and television segments increased 2.3% and 2.8% respectively.

Hitachi, Ltd fell 0.8% to 828.20 yen after the diversified company agreed with Italy-based conglomerate Finmeccanica S.p.A to acquire its train-making unit AnsaldoBreda and 40% stake in rail signaling operator Ansaldo STS for more than $2 billion or €1.8 billion to expand its transportation business outside Japan.

Hitachi will launch official tender offer for all the remaining shares of Ansaldo STS.

Sosei Group Corporation plunged 9.7% to 3,445 yen after the biopharmaceutical company may acquire privately owned U.K.-based biotechnology business Heptares for up to $400 million or £260.6 million.