Weak Building Data in Japan, Stocks Fall

123jump.com Staff
27 Dec, 2007
New York City

Stocks in Japan declined at close on rising energy prices and slumping construction. a weakness in the housing market related to new building code was confirmed in the November data. Housing starts in November plunged 27% from a year ago and declined 35% from October. Construction equipment unit shipment rose 10.4% in November and exports increased 15% in value. Auto unit production in the month rose 3.8% and exports from Japan increased 8.1%.

[R]5:00AM New York, 7:00PM Tokyo-Housing starts fell to 27% in November.[/R]

In Tokyo trading Nikkei 225 shed 0.57% or 88.85 to 15,564.69, while the broader Topix Index plunged 8.53 to 1,499.94.

In the first section of the Tokyo Stock Exchange 6.9 billion shares valued at 723 billion yen were traded and in the in the second section 284 million shares worth 4.8 billion yen changed hands.

Of the Nikkei 225 stocks 56 gained, 158 declined, and 11 were unchanged. Clarion Company Limited led advancers with a rise of 5.15% followed by Tokyu Corporation firming 3.63%.

Construction companies gained as Japan’s shipments of construction equipment rose 10.4% in November. Komatsu Limited jumped 1.65% and Hitachi Zosen soared 1.29%.

Crude oil prices rose 2% to $95.97 per barrel yesterday. Inpex rose 0.81% as a result.

The Ministry of Land, Infrastructure and Transported reported today that housing starts for new condominiums and new homes fell to 84,252 in November, 27% decline from a year ago, and 35% from October.

New dwellings started for owned and rented properties slumped 7.6% to 26,604 and 23.4% at 38,859 respectively.

New buildings for collective housing fell 63.9% to 8,331, while detached houses retreated 14.9% to 10,054.

The Land Ministry further stated that building construction starts for public investors slumped 45.3% to 377 and private investors slipped 19.2% to 12,440. Land dwellings plunged 26.7% to 7,337 units, with non-dwellings falling 9.6% at 5,439.

Building construction for mining tumbled 66.2% in November to 53 and manufacturing declined 22.4% to 983. However, wholesale and retail constructions rose 75.3% at 2,141, while real estate climbed 25.3% to 211.

Separately, the Ministry of Land, Infrastructure and Transport said today total construction orders from the 50 big domestic contractors declined 3.8% from a year earlier to 915.5 billion yen.

Japan’s Construction Equipment Manufacturers Association reported today that shipments of construction equipment rose 10.4% to 219 billion yen in November buoyed by rising demand in Russia, China and Southeast Asia.

CEMA further revealed domestic shipments climbed 4.3% to 86.4 billion yen and exports rising 14.8% to 132.7 billion yen.

Japan’s Automobile Association said today the country’s twelve largest manufacturers built in November 1.07 million cars, mini-cars, trucks and buses, an increase of 3.8% from a year ago. Exports rose 8.1% to 600,422.

The yen soared 0.06% from 114.27 to 114.25 at the close of trade.

Of the Nikkei 225 index shares Clarion Company Limited led gainers with a rise of 5.15% followed by gains in Tokyu Corporation of 3.64%, in NEC Corporation of 2.98%, in Japan Airlines of 2.66%, and Sumitomo Chemical Company of 2.56%.

Sanyo Electric led the decliners in the Nikkei 225 stocks with a retreat of 6.59% followed by losses in Marubeni Corporation of 3.12%, in Chugai Pharmaceuticals of 3%, and Dowa Holdings of 2.99%.

Sanyo Electric Company fell after the Tokyo Stock Exchange placed a special monitoring status on the company’s shares with a possible delisting. The company reported Tuesday that it will review its earnings as back as 2000 and will report 6 billion yen in losses from April 2000 through to September 2007.

In addition, the Mainichi news, an online edition, reported that Japan’s Securities and Exchange Surveillance Commission has accused Sanyo of fraudulent earnings and urged the Financial Services Agency to impose 8.3 billion yen fine.

Financial stocks also fell on Nikkei news reports Japan’s five largest lenders paid customers 260 billion yen in the year to November for excessive interest rates, adding the figure might rise to 300 billion yen by the end of the year.

Also S&P/Case Shiller home price index reported yesterday that home prices fell 6.1% in October in twenty U.S. metropolitan areas. The narrow index includes cities like Las Vegas, Miami, and San Diego that have recently seen excessive speculation in housing market. Broader indexes that measure home prices across the nation have declined but not that sharply. Mitsubishi UFJ Financial Group plunged 1.28%, Mizuho Financial Group tumbled 1.43% and Sumitomo Mitsui Financial Group dropped 0.69%.

Kyodo news reported on Tuesday that subscribers of Softbank’s discount White Plan for mobile telephone services has crossed 10 million, which accounts for 60% of the company’s subscriber base.

Bloomberg news reported today that Samsung Electronics is suing Sharp Corporation for the alleged infringement of four U.S. patents for technology used in television and computer monitors.