Tokyo Stocks Rebound; Automakers Rise

123jump.com Staff
04 Jun, 2008
New York City

Stocks in Tokyo gained ground after yen fell and metals and crude oil prices fell. Nikkei 225 rose 1.59% or 226.4 at 14,435.57, while the broader Topix Index increased 1.6% or 23.03 at 1.430.47. Capital spending declined for the fourth straight quarter by 5.3% in the three months ending March. The decline was smaller than estimated by economists.

[R]5:00AM New York, 7:00PM - Japan’s capital spending drops less than forecasted at 5.3% in the January-March period. Yen rose against dollar. Asian car makers gain share in the U.S. market.[/R]

Japan stock averages rose on reports that Asian car makers sold more cars than General Motors, Chrysler LLC and Ford Motor Corp in the U.S. Weaker yen lifted exporters.

Market sentiment

In Tokyo trading Nikkei 225 rose 1.59% or 226.4 at 14,435.57, while the broader Topix Index increased 1.6% or 23.03 at 1.430.47.

In the first section of the Tokyo Stock Exchange 12 billion shares worth 1.2 trillion yen were traded and in the second section 301 million shares valued 5.3 billion yen changed hands.

Of the Nikkei 225 stocks 165 gained, 53 declined, and 7 were unchanged. Ebara Corp led advancers in the index shares with an increase of 13.32% followed by Nippon Sheet Glass rising 11.74%.

Capital spending falls 5.3% in January-March period

Japan’s Ministry of Finance reported today that capital spending, excluding software, declined for the fourth straight quarter by 5.3% in the three months ending March.

The less than forecasted decline fueled the expectations that the government will increase the economic growth forecast next week.

The Finance Ministry also revealed that the combined pretax profit at Japanese companies fell 17.5% to 13.75 trillion yen year-on-year in the review period on rising raw material costs.

Asia carmakers market share jump to 48.2% in the U.S.

The combined car sales for Asian automakers in May rose by 3.7% to 671,398 units in the U.S., 32,290 units more than combined sales from General Motors Corp, Chrysler LLC and Ford Motor Corp.

Statistics show that the combined sales from the U.S.’s three biggest automakers fell by 23.5%.

Sales from Nissan gained 8.4% leveraged by sales of the Altima, Sentra and Versa Compact models, while Mazda, Fuji Heavy Industries and Honda advanced 4.2%, 13% and 15.6% respectively. However, sales from Toyota and Mitsubishi fell 4.3% and 24% correspondingly.

Cumulatively, the market share from the Asian carmakers rose to a record 48.2%, while the share for U.S. based automakers declined to 44.5%. The news was first reported by Bloomberg News.

Gainers & Losers

Ebara Corp. led advancers in the Nikkei 225 index shares with a rise of 13.32% followed by increases in Nippon Sheet Glass of 11.74%, in Fast Retailing of 11.29%, in Mazda Motor Corp. of 9.12%, and Meidensha of 7.95%.

Fast Retailing rose after it reported operating profit in the year ended August 3 will rise to 83 billion yen, compared with the April forecast of 80.1 billion yen as reported in Nikkei News.

Mazda Motor Corp. increased after sales in the U.S. gained by 4.2%. Honda gained 7.06%, Fuji Heavy Industries advanced 5.77%.

Exporters gained as the yen slipped to 105.19 from 104.25 yesterday against the dollar after the Fed Chairman Bernanke comments indicated renewed focus on stronger dollar. Nikon Corp edged up 3.34%, Toyota grew 3.5% and Sony Corp increased 2.80%.

Casio Computer led decliners in the Nikkei 225 index shares with a drop of 5.95% followed by losses in Sumitomo Metal Industries of 2.75%, in Nippon Suisan of 2.53%, in Mitsumi Electric Co. of 2.48%, and Taiyo Yuden Co. of 2.44%.

Sumitomo Metal Industries fell after oil and commodity prices dropped as the dollar rallied. Crude oil fell 2.7% to $124.31 a barrel yesterday, while gold climbed down 1.3%. The oil refiner Inpex fell 2.27%.