Japan Indexes Extend 2-Day Rally, Panasonic and Isetan Mitsukoshi In Focus

Akira Ito
05 Feb, 2025
Tokyo

Stock market indexes in Tokyo advanced for the second consecutive day amid a rally in tech stocks and easing of tensions between the U.S. and its two key trading partners. 

The Nikkei 225 stock average and the TOPIX dropped slightly after semiconductor equipment technology recovered following a rally on Wall Street. 

Market sentiment recovered after the U.S. presidential administration caved in and delayed the implementation of tariffs on goods shipped from Mexico and Canada. 

However, the U.S. imposed an additional 10% tariff on goods imported from China, and the U.S. Postal Service temporarily blocked parcels from China and Hong Kong. 

 

Japan's Real Wages Advanced for the Second Consecutive Month in December

Japan's real wages, adjusted for inflation, advanced for the second consecutive month in December, supported by the rise in winter bonuses. 

Nominal wages increased for the second consecutive month in December, surpassing the market expectations and advancing the most in three decades. 

The annual increase in nominal wages in December accelerated to 4.8% in December from 3.9% in November, and real wages adjusted for inflation advanced 0.6%, marking the second month of increase. 

December month's wage increase was largely driven by a 6.8% rise in winter bonuses, the Ministry of Health, Labour, and Welfare reported Wednesday. 

Despite the surge in wages, the ministry noted wages and base salaries are not "keeping pace with prices."

 

Japan's Services Sector Growth Accelerated In January

Japan's service sector activities accelerated in January, according to the data released by S&P Global. 

The au Jibun Bank Japan Services PMI increased to 53.0 in January from 50.9 in December. 

A reading above 50 indicates an increase in growth, while below 50 shows contraction.

 

Japan Indexes and Movers 

The Nikkei 225 Stock Average edged up a fraction to close at 38,831.48, and the TOPIX advanced 0.3% to 2,745.41. 

Panasonic Holdings Corp. soared 13.6% to ¥1,738.50 after the company raised earnings outlook for its battery division and announced its plans to reform management. 

Revenue in the nine months ending in December increased 1.6% to 6.4 trillion yen, but net profit declined 25.4% to 308.7 billion yen, and diluted earnings per share decreased to 123.51 yen from 170.96 yen.

The company said its reforms will begin in the next financial year starting in April and aims to improve profitability by 150 billion yen and an additional 150 billion yen over the next two fiscal years.

Panasonic said in a separate release that its battery unit's operating profit in the fiscal third quarter ending in December rose 39%, and the company raised its full-year outlook by 14% to 124 billion yen, or $799 million.

The company estimated fiscal year 2025 revenue to increase 98% from a year ago to 8.3 trillion yen and operating profit to jump 19% to 380 billion yen.

Isetan Mitsukoshi Holdings dropped 4.8% to ¥2,542.0, despite the department store retailer reporting a higher-than-expected 21% increase in operating profit in the fiscal third quarter. 

Revenue in the nine-month period ending in December increased 3.9% to 417.5 billion yen, ordinary profit surged 47% to 66 billion yen, and diluted earnings per share advanced to 124.72 yen from 81.28 yen a year ago.