Bank of Japan Leaves Rates and Stimulus Tartget Unchanged

Hiruki Nakamura
15 Jul, 2015
New York City

Nikkei average advanced after the Bank of Japan left its reference rate on hold and left its target to stimulate the economy unrevised. However, the central bank lowered its annual growth estimate to 1.7%. Nippon Prologis quarterly revenues rose 6% and Fujifilm expanded its stock repurchase plan.

[R]4:30 PM Tokyo – Nikkei average advanced in Japan after the Bank of Japan left its reference rate on hold and left its target to stimulate the economy unrevised. However, the central bank lowered its annual growth estimate to 1.7%. Nippon Prologis quarterly revenues rose 6% and Fujifilm expanded its stock repurchase plan.[/R]

Nikkei average in Tokyo advanced after the Bank of Japan left its interest rate and stimulus policy and targets unchanged and China reported better than expected economic growth.

As widely expected, after a two-day policy meeting the Bank of Japan kept its benchmark lending rate on hold at 0.1% and the central bank lowered its growth estimate for the year to 1.7% from the previous estimate of 2%.

Separately, the bank also left its target unchanged for the stimulus program and expand the monetary base at an annual pace of about 80 trillion yen.

China’s second quarter growth was 7% and industrial production rose at 6.8% and retail sales surged 10.6%, according to the latest data released by the statistics bureau.

The Nikkei 225 Stock Average gained 78 or 0.4% to 20,463.33 and the broader Topix index rose 7.70 to 1,646.41.

The yen closed at 123.45 against a dollar.

Stocks in Review

Aderans Co Ltd fell 0.7% to 1,032 yen after the ready-made wigs maker said net sales in the in the first-quarter ending in May jumped 4.7% to 19.71 billion yen from 18.83 billion yen in a year ago period.

Net income in the quarter tumbled 76.9% to 54 million yen compared to 236 million yen and diluted earnings per share declined to 1.31 yen from 6.42 yen in the same period a year ago.

Aderans forecasted net sales in the first-half to increase 2% to 38 billion yen but net income to plunge 42.6% to 800 million yen.

The company forecasted net sales for the year ending in February to climb 5.6% to 81 billion yen while net income to plummet 44.8% to 2.80 billion yen.

Fujifilm Holdings Corp gained 1.5% to 4,481.50 yen after the diversified company plans to buyback its 16 million shares worth about 50 billion yen between January 29 and July 31.

Separately, the company said it has already completed its share buyback program for up to 3.77 million worth about 16.47 billion yen between July 1 and July 13.

Nippon Prologis REIT Inc rose 0.8% to 230,500 yen after the real estate developer reported revenues in the second-quarter ending in May climbed 6% to 14.24 billion yen from 13.44 billion yen in a year ago period.

Net income in the quarter jumped 5.7% to 5.79 billion yen compared to 5.47 billion yen and diluted earnings per share increased to 3,344 yen from 3,355 yen in the same period a year ago.

The real estate developer forecasted revenues for the third-quarter ending in November to gain 0.9% to 14.37 billion yen and net income to increase 2.9% to 5.96 billion yen.

For the year, the company forecasted revenues for the fourth-quarter ending in May 2016 to fall 0.4% to 14.31 billion yen and net income may nearly flat or edged up 0.1% to 5.96 billion.

Takashimaya Company, Limited soared 4.2% to 1,171 yen after the department store operator said sales in June jumped 2.9% and sales at four regional stores in Okayama, Gifu, Yonago and Takasaki increased 2.6%.

Sales in the Western region climbed 6% while sales in the Eastern region slipped 1.3% but total sales in the month gained 1.5%.

Corporate segment sales surged 23.2% and sales from the cross-media business segment soared 24.2%.