Nikkei Rally on Hold After 5% Surge in March, GS Yuasa Lowers Outlook

Hiruki Nakamura
24 Mar, 2015
New York City

Stocks in Tokyo eased after investors booked profit following 5% rally in Nikkei this month. For the year so far, the benchmark index has jumped 13%. Japan revises corporate governance code and listed companies are now required to have at least two independent directors.

[R]4:30 PM Tokyo – Stocks in Tokyo eased after investors booked profit following 5% rally in Nikkei this month. For the year so far, the benchmark index has jumped 13%. Japan revises corporate governance code and listed companies are now required to have at least two independent directors.[/R]

Stocks in Tokyo closed lower after investors took an advantage of the recent market rally to book profit.

Nikkei index in March has jumped 5% and in the year so far has advanced 13%.

The Nikkei 225 Stock Average fell 40.91 or 0.2% to 19,713.45 and the broader Topix index slid 4.66 to 1,587.59.

The yen closed at 119.43 against a dollar.

Foreign investors also showed more interest in Japanese equities after the recent changes in corporate governance code. The new code, introduced by Prime Minister Shinzo Abe’s government to improve economic growth, requires listed companies to have at least two independent directors.

The move is expected to nudge companies to become more shareholder friendly and improve returns.

Stocks in Review

GS Yuasa Corporation declined 3.1% to 568 yen after the batteries and power supply devices maker reduced its net-income forecast for the year to 10 billion yen after writing down of 2.3 billion yen in lithium unit and lower sales in automobile lithium-ion batteries segment.

Earlier, the company forecasted net income for the year to climb 30% to 13 billion yen.

Mandom Corporation fell 0.7% to 4,520 yen after the cosmetic products maker said net sales for the fiscal year ending in March to climb 3% to 70 billion yen and operating profit to increase 2% to 7 billion yen.

Oki Electric Industry Co., Ltd gained 1.6% to 261 yen after the Nikkei news reported information technology forecasted net sales for the year to climb 11% to about 538 billion yen slightly higher than the earlier estimate of 535 billion yen.

The company estimated operating profit for the fiscal 2014 to soar 18% to 32 billion yen, above the previous guidance of 30 billion yen.

Pasona Group Inc fell 0.7% to 746 yen after the outsourcing services provider plans to acquire a 49% stake in Indonesia-based staffing services provider Duta Griya Sarana with a target to increase its sales in Indonesia to 5 billion yen in next three years.