Leaders in Japan Urge to Buy Stocks

123jump.com Staff
08 Jan, 2008
New York City

Stocks in Japan edged higher afte a concerted efforts by business leaders and several analysts to encourage people to buy stocks. Several business leaders sggeste that Japanese stocks are undervalued. However, the positive statements did not help stock market. Nikkei 225 index edged 0.2% or 28.12 higher to 14,528.67 and Topix gained 0.74% or 10.35 to 1,403.06. Stocks in shipping, banking, and metals sectors advanced.

[R]5:00AM New York, 7:00PM Tokyo – Stocks in Tokyo edged 0.19% higher for the first time in 2008.[/R]

Stocks in Japan gained for the first time this year in volatile trading as investors sought commodity, shipping lines and financial stocks.

In Tokyo trading Nikkei 225 rose 0.19% or 28.12 to 14,528.67, while the broader Topix Index gained 0.74% or 10.35 to 1,403.06.

In the first section of the Tokyo Stock Exchange 9.1 billion shares worth 1.0 trillion yen were traded and in the second section 164.4 million shares valued at 3.0 billion yen changed hands.

Of the Nikkei 225 stocks 133 gained, 81declined, and 11were unchanged. Sumitomo Mitsui Financial Group led advancers with a rise of 6.69% followed by Shimizu Corporation climbing 6.44%.

Other financial stocks rose as well. Mizuho Financial Holdings climbed 5.27%, Mitsubishi UFJ Nicos edged up 5.02% and Resona Holding jumped 3.91%.

The Japan Times online edition reported today that Chairman of the Japan Business Federation Fujio Mitarai said yesterday that Japan economy will pick up in the second quarter buoyed by strong overseas demand.

“The pace of domestic economic expansion will accelerate after spring,” said Mitarai, adding that he believes that Japanese stocks were oversold.

Chairman of the Japan Association of Corporate Executive Masamitsu Sakurai also said at the same conference that the stock market is “overreacting” to uncertainties over the U.S. economy.

Chief economist at JP Morgan Chase & Company Masaaki Kanno said in a report published yesterday that the Bank of Japan will refrain from raising the benchmark interest rate until the fourth quarter. Kanno also revised downward Japan’s projected economic growth for this year from 2.0% to 1.8% for the year starting April 1.

Of the Nikkei 225 index shares Sumitomo Mitsui Financial Group led advancers with a rise of 6.69% followed by gains in Shimizu Corporation of 6.44%, in Nippon Light Metals of 5.98%, in Kawasaki Kisen of 5.52%, and KDDI Corporation of 5.4%.

Shipping lines also gained after Deutsche Bank recommended investors to buy the stocks. Also the Baltic Dry Index, which measures freight charges, rose for the first time in three weeks. Mitsui OSK Lines spiked 3.82% and Mitsui Engineering & Shipbuilding rose 1.01%.

Commodity stocks gained as well. Nippon Light Metal jumped 5.98% and Sumitomo Metal Industries soared 4.67%.

Fanuc Limited led declining Nikkei 225 index shares with a drop of 4.99% followed by losses in NSK Limited of 4.39%, in Okuma Corporation in 4.25%, in Seven I & Holdings of 3.48%, and in Alps Electrical Company Limited of 3.41%.

Exporters slumped after the yen fell from 109.47 to 109.48 against the dollar. Canon Corporation fell 0.20% and Casio Computer dropped 0.85%.

The Nikkei news, online edition, reported today that Hitachi Construction Company might joint venture with a Russian company Techstroycontract Limited to make buckets for excavators. The companies are targeting to produce 3,000 buckets for excavators per year. In addition, the company will start making complete excavators in April 2012.


Asian Markets Roundup

In Tokyo Nikkei 225 Index closed higher 28.12 or 0.19% to 14,528.67, in Hong Kong Hang Seng index closed declined 66.59 or 0.25% to 27,112.90, in Australia ASX 200 closed lower 33.50 or 0.54% to close 6,128.10.

In South Korea Kospi Index decreased 4.91 or 0.27% to close at 1,826.23, in Thailand SET index closed higher 3.38 or 0.42% to 811.69, and Indonesia JSE Index edged increased 9.22 or 0.33% to 2,785.63. Sensex index in India closed higher 60.68 or 0.29% to 20,873.33.