Japan Trade Surplus Drops

123jump.com Staff
21 Aug, 2008
New York City

Global credit markets weakness spread by the regulatory failures in the U.S. financial system continue to hobble investors in Japan and in Asia. Stocks in Tokyo fell. Japan trade surplus in July dropped 87% to 91 billion yen as imports rise faster than exports on rising crude oil prices. Exports to China and Asia continue to rise and but exports to the U.S. declined for the eleventh month in a row.

[R]5:00AM New York, 7:00PM Tokyo - Japan trade surplus drops 86.6% to 91.1 billion yen in July.[/R]

Stocks in Japan continued to reel from the weakness in the global economy as a government report showed that the country’s trade surplus fell in July after the import bill soared on rising oil prices.

Resurgent energy prices also adversely affected investor sentiment. However, commodity stocks helped trim losses.

Market Sentiment

In Tokyo trading Nikkei 225 fell 0.77% or 99.48 to 12,752.21, and the broader Topix declined 0.7% or 8.84 to 1,224.53.

In the first section of the Tokyo Stock Exchange 7.4 billion shares worth 755 billion yen were traded and in the second section 182 million shares valued at 3.4 billion yen changed hands.

Of the Nikkei 225 stocks 56 rose, 155 declined, and 14 were unchanged. Nippon Soda Co. led advancers in the index shares with a rise of 5.37% followed by Sojitz Corp. gaining 4.47%.

Japan Trade Surplus Drops 86.6% in July

Japan’s Ministry of Finance reported on its Web site today that exports rose 8.1% to 7.63 trillion yen in July and imports gained significantly by 18.2% to 7.54 trillion yen due to soaring crude oil prices. Crude oil prices peaked on July 14 to $147 per barrel. Trade surplus in the period dropped 86.6% to 91.1 billion yen.

The finance ministry observed that exports to Asia soared a record 12.7% to 3.86 trillion yen on strong sales of raw material and mineral fuels, while shipments to Europe increased by 4.1%. On the overall, the trade surplus with Asia surged 42.3%.

Notable, exports to China rose 16.8% to a record 1.29 trillion, but trade surplus to the country plummeted 63.3%. Shipments to the U.S. fell for the 11 consecutive month to 1.28 trillion yen, while trade surplus fell 19% on slower demand of consumer electronics and cars.

Land Prices Decline More Than They Rise in Q2

Bloomberg News reported on its Website today that according to the Ministry of Land Infrastructure, Transport and Tourism of the 100 locations surveyed, land prices rose in 13 places compared to 41 places the previous three months in the second quarter ending in June. Also prices rose in 38 places in the period.

Gainers & Losers

Nippon Soda Co. led advancers in the Nikkei 225 index shares with a rise of 5.37% followed by increases in Sojitz Corp. of 4.47%, in Mitsumi Electric Co. of 3.95%, in Mitsubishi Rayon Co. of 3.45%, and Toho Zinc Co. of 3.17%.

Commodity stocks gained as metal prices advanced. Sumitomo Metal Mining spiked 3.16% and Sumitomo Metal Industries edged up 3%.

Inpex Holdings soared 2.73% after crude oil for October delivery climbed as much as 1.4 % to $116.54 a barrel.

Alps Electric Co led decliners in the Nikkei 225 index shares with a fall of 3.72% followed by losses in OKI Electric Industries of 3.33%, in Aeon Co Ltd of 3.30%, in Fuji Heavy Industries of 3.21% and Shionogi & Co of 3.14%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 99.48 or 0.77% to 12,752.21, Hang Seng index in Hong Kong decreased 539.20 or 2.58% closed to 20,392.06. ASX 200 index in Australia decreased 54.30 or 1.10% to close 4,875.20. The KL Composite index in Malaysia decreased 1.78 or 0.17% closed to 1,071.43.

The Kospi Index in South Korea decreased 28.12 or 1.83% to close at 1,512.59, SET index in Thailand closed lower 13.52 or 1.96% to 676.53 and JSE Index in Indonesia increased 18.55 or 0.90% to 2,088.25. The Sensex index in India decreased 434.50 or 2.96% closed to 14,243.73.