Japan Indexes Extended Rally to Third Day, Hino Motor Plunged 11%

Akira Ito
30 Oct, 2024
Tokyo

Market indexes in Tokyo advanced and extended gains for the third session in a row following gains in tech stocks in overnight trading in New York. 

The Nikkei 225 stock average increased 1%, and the Topix index edged up 0.8%, powered by the increase in advanced semiconductor equipment makers.

Despite the three-day market gains, investors are on edge amid heightened political instability as leading political parties struggle to form the next government. 

The ruling Liberal Democratic Party and Komeito coalition is searching for additional partners and seeking alliances with independent candidates to reach the required majority of 233 members in the lower house of the parliament. 

The Bank of Japan is scheduled to announce its rate decisions on Thursday, and the central bank is widely expected to hold steady interest rates. 

Japan's policymakers are struggling to wean off the economy from its reliance on negative interest rates for decades and fight deflationary conditions amid stagnant wages. 

For nearly three decades, large Japanese corporations have preferred to invest in foreign countries and not repatriate overseas profits, the root cause of two decades of stagnant wages in Japan. 

Moreover, the current weakness in the Japanese yen has contributed to capital flight, sucking more capital from the domestic economy. 

 

Japan Stock Movers 

The Nikkei 225 Stock Average increased 1% to 39,277.39, and the broader Topix index advanced 0.8% to 2,703.72. 

Advanced semiconductor equipment makers led the gainers on the Tokyo Stock Exchange. 

Disco Corp. soared 11.2% to ¥45,320.0, Advantest gained 3.5% to ¥8,595.0, and Tokyo Electron increased 0.1% to ¥24,010.0. 

Mitsubishi UFJ Financial Group increased 1.2% to ¥1,629.0, Sumitomo Mitsui Financial Group advanced 0.9% to ¥3,270.0, and Mizuho Financial gained 0.7% to ¥3,223.0. 

Crude oil and natural prices drifted towards the 2024 low, driving stocks of electric utility companies higher. 

Furukawa Electric jumped 3.9% to ¥3,864.0, Kansai Electric Power advanced 4.7% to ¥2,607.0, Chubu Electric Power gained 3% to ¥1,756.50. 

Hino Motors plunged 13.4% to ¥406.10 after the scandal-hit vehicle maker reported a huge loss and revised its annual outlook. 

The truck maker admitted that fuel emission data have been tampered with dating as far back as 2003 and not since 2016, as reported previously. 

The company in the first-half reported a net loss of 219 billion yen, or $1.4 billion, after it took an extraordinary loss of 230 billion yen linked to its legacy certification issues in the U.S. and class action settlement in Canada, which were discovered in 2022. 

The company estimated a full-year net loss of 220 billion yen and forecast additional losses linked to the emission data falsification scandal.