Rising Global Bond Yields Drag Nikkei, Konica Minolta Surges

Hiruki Nakamura
14 May, 2015
New York City

Rising bond market yields hovered stock market sentiment in Tokyo and 10-year Japanese government bond yield jumped to a two-month high of 0.47%. Railroad company stocks declined. Konica Minolta announced stock buyback and dividend hike. Toshiba plans to write down earnings in last three years.

[R]4:30 PM Tokyo – Rising bond market yields hovered stock market sentiment in Tokyo and 10-year Japanese government bond yield jumped to a two-month high of 0.47%. Railroad company stocks declined. Konica Minolta announced stock buyback and dividend hike. Toshiba plans to write down earnings in last three years.[/R]

Stocks and market indexes in Japan continued to trade sideways on the volatile global bond market.

10-year yield on Japanese bonds rose to 0.47%, matching a two-month high as financial markets around the world are re-pricing stocks in the face of rising interest rate environment.

The Nikkei 225 Stock Average slumped 194.48 or 0.9% to 19,570.24 and the broader Topix index dropped 12.72 to 1,591.49.

The yen closed at 118.90 against a dollar.

Stocks in Review

Daiichi Sankyo Company, Limited climbed 4% to 2,184 yen after the pharmaceutical company reported revenues in the year ending in March jumped 2.3% to 919.37 billion yen from 899.13 billion yen in a year ago period.

Net income in the year soared five-fold to 318.92 billion yen compared to 53.36 billion yen and diluted earnings per share climbed to 456.62 yen from 86.41 yen in the same period a year ago.

Dentsu Inc dropped 2.5% to 5,420 yen after the advertising and marketing services provider said net sales in the year ending in March climbed 10.4% to 728.63 billion yen from 659.77 billion yen in a year ago period.

Net income in the year surged 20.1% to 79.85 billion yen compared to 66.51 billion yen and diluted earnings per share jumped to 322.1 yen from 306.4 yen in the same period a year ago.

Hitachi Ltd gained 0.8% to 838.30 yen after the diversified conglomerate reported revenues in the year ending in March jumped 2.1% to 9.76 trillion yen from 9.56 trillion yen in a year ago period.

Net income in the year declined 8.9% to 241.30 billion yen compared to 264.98 billion yen and diluted earnings per share slipped to 49.97 yen from 54.86 yen in the same period a year ago.

Hitachi forecasted revenues for the first-half ending in September of about 4.7 trillion yen and net income of about 70 billion yen.

The conglomerate forecasted revenues for the year ending in March 2016 jump 1.9% to 9.95 trillion yen and profit to climb 28.6% to 310 billion yen.

Nikon Corporation edged up 0.06% to 1,715 yen after the image and video equipments maker said net sales in the year ending in March plunged 12.5% to 857.78 billion yen from 980.56 billion yen in a year ago period.

Net income in the year tumbled 60.8% to 18.36 billion yen compared to 46.82 billion yen and diluted earnings per share slumped to 46.21 yen from 117.88 yen in the same period a year ago.

For the first-half, Nikon forecasted net sales to drop 0.3% to 374 billion yen and net income to plunge 90.1% to 1 billion yen.

The company forecasted net sales for the fiscal year ending in March 2016 to increase 0.3% to 860 billion yen and net income to climb 8.9% to 20 billion yen.

Sharp Corporation slipped 1% to 200 yen after the electric and electronic equipments maker reported revenues in the year ending in March dropped 4.8% to 2.79 trillion yen from 2.93 trillion yen in a year ago period.

Net in the year swung to a loss of 222.35 billion yen compared to profit of 11.56 billion yen and diluted loss per share swung to a 131.51 yen from diluted earnings per share of 7.87 yen in the same period a year ago.

For the fiscal first-half, the company forecasted net sales to fall 2.1% to 1.30 trillion yen and operating profit to decline 65.8% to 10 billion yen.

For the year, net sales are estimated to increase 0.5% to 2.80 trillion yen.

Sharp secured a $1.7 billion bailout from banks, as Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ will jointly inject 200 billion yen in a debt-for-equity swap, the company said in a statement.

Toshiba Corp gained 0.8% to 426.30 yen after the power and infrastructure developer estimated that it may have to write down income for past three years by 50 billion yen or $420 million.