Japan Indexes Struggle Ahead of Inflation and Business Activities Surveys On Friday, Toyota Chairman Reelected

Akira Ito
20 Jun, 2024
Tokyo

Stocks opened lower in Tokyo and traded down for most of the session amid interest rate uncertainty, persistent weakness in the yen, and ahead of the release of economic data. 

Investors are looking forward to the release of consumer inflation data in May and business activity updates in the manufacturing and services sectors on Friday. 

The Nikkei 225 and the Topix index traded down in the session, but the Nikkei managed to climb above the flatline in the final thirty minutes of the session. 

The yen weakened to 158.24 against the U.S. dollar in Tokyo amid interest rate uncertainty and the Bank of Japan's lack of urgency in fixing the persistent and wide rate differential between the U.S. and Japanese government bonds. 

 

Japan Stock Movers 

The Nikkei 225 Stock Average closed up 0.2% to 38,631.0, and the Topix Index declined 0.1% to 2,725.05. 

Tech sector stocks turned lower amid a lack of clues from New York trading. Financial markets in the U.S. were closed for a public holiday on Wednesday. 

Advantest, Tokyo Electron, and Screen Holding dropped as much as 1%. 

Banks were among the leading decliners due to rate uncertainty and the persistent weakness of the yen. 

Mitsubishi UFJ Financial, Sumitomo Mitsui, and Mizuho Financial dropped between 1% and 2%.

Among other widely held stocks, Fujikura, Kawasaki Heavy Industries, and Nidec fell between 3% and 5%. 

Toyota Motor decreased 0.7% to ¥3,084.0, and earlier this week only 71.93% of shareholders approved the company Chairman Akio Toyoda reelection, according to a tally released by the finance ministry. 

Akio Toyoda's approval took a big hit after the certification scandal and fell from 84.57% in 2023 to 96% in 2022. 

Earlier this month, Japan's transportation ministry suspended the shipment of six Japanese vehicles, including three made by Toyota. 

Despite the ongoing regulatory challenges linked to the embarrassing certification scandal, the company is enjoying record global sales and holding onto its number one positive for the fourth year in a row, surpassing Volkswagen AG. 

In its latest fiscal year, Tokyo posted five trillion yen, or $31.7 billion, in operating profit, making it the first Japanese company to achieve the record. 

In early 2023, Akio Toyoda stepped down from its chief executive position after 14 years and assumed the role of chairman, leading the company's transition to hybrid cars when the industry was shifting to electric vehicles.