Japan Indexes Lacked Direction; Toho, Komatsu and Toray Advanced

Akira Ito
17 Jul, 2024
Tokyo

Amid positive market sentiment, stock indexes in Tokyo advanced in Wednesday's trading, supported by gains in overnight trading in New York. 

The Nikkei 225 stock average and the Topix index diverged at close but advanced in early trading. 

Market sentiment was positive on the growing conviction that the U.S. Federal Reserve is set to start its rate cuts as early as September. 

In addition, the S&P 500 index advanced to a new high as the market rally broadened beyond mega-cap tech stocks. 

The small-cap-focused Russell 200 index gained nearly 2% and increased for the fifth session in a row. 

Closer to home, on the economic front, the Tankan survey showed business sentiment among large manufacturers increased to a seven-month high in July, despite the weakening of confidence among nonmanufacturing companies. 

Investors are looking forward to the Bank of Japan's policy meeting at the end of this month, and the policy committee is expected to announce its bond tapering plan from the current purchase of 6 trillion yen a month. 

 

Japan Stock Movers 

The Nikkei 225 stock average decreased 0.3% to 41,147.42, and the Topix index advanced 0.4% to 2,917.04. 

Tech stocks traded down following the weakness in overnight trading in New York. 

Tokyo Electron, Advantest, Screen Holdings, and SoftBank declined between 0.3% and 1.5%. 

Industrial and consumer exporters gained from thin trading. 

Mitsubishi Electric, Canon, Sony, and Panasonic gained between 0.2% and 2%. 

Toho Co. soared 11.2% to ¥5,064.0 after the entertainment distribution company reported a sharp increase in earnings in its movie business. 

Net profit in the quarter ending in May increased 31% to 16.5 billion yen, or $102. million, driven by a 16% increase in revenue to 86 billion yen. 

Operating profit from its movie unit increased 53% to 20.10 billion yen, and the company retained its annual earnings outlook for the fiscal year ending in February 2025. 

The company forecasts annual revenue to fall 1.2% to 280 billion yen and net income to drop 14% to 39 billion yen. 

Hitachi Construction Machinery, Toray Industry, Komatsu, and Sumitomo Heavy Industries advanced between 3% and 4%.