Weakest Confidence in Japan in 25 Years

123jump.com Staff
12 Nov, 2008
New York City

Nikkei 225 index in Japan dropped below its underlying book value as domestic investors sell stocks. Consumer confidence in Japan dropped to the lowest level since 1982 in October. Inpex lowered its revenue and earnings outlook for the year. Softbank led the gainers after Alibaba.com earnings rise.

[R]8:00AM New York, 8:00PM Tokyo – The consumer confidence in Japan drops in October. Inpex revises full year profit forecast.[/R]

Japan stock indexes declined 1.3% on a government report that consumer confidence in October dropped to the lowest level since 1982. Metal and oil prices also dropped on fears of slowing global demand.

In Tokyo trading Nikkei 225 declined 1.3% or 113.79 to 8,695.51, and the broader Topix Index shed 1.6% or 14.13 to 113.79.

In the first section of the Tokyo Stock Exchange 9.1 billion shares worth 714 billion yen were traded and in the second section 193 million shares valued at 1.8 billion yen changed hands.

Of the Nikkei 225 index stocks 56 rose, 163 declined, and 6 were unchanged. Softbank Corp. led advancers in the index after Hong Kong based Alibaba.com, in which the company has a 29% stake, said third quarter profits increased by 49%.

Consumer Confidence Falls

The Cabinet Office reported that the country’s consumer confidence plunged to 29.4 in October from 31.4 the previous month, the lowest since 1982.

Overall livelihood index dropped to 29.6 from 30.6 a month earlier. Confidence index about employment declined 4.1 points to 24.8 from 28.9 in the previous month.

The cabinet office also noted that income growth eased to 34.5 from 35.8 a month ago, while the willingness to buy durable goods index fell to 28.8 from 30.3 a month earlier.

Tokyo Stock Exchange Starts Disclosing Short Sales

Tokyo Stock Exchange yesterday began disclosing short sales of positions amounting to at least 0.25% of the shares of a company as part of broad measures to calm the stock market.

According to Bloomberg News, yesterday’s filings indicated that Nomura International Plc took most short sale positions on 25 companies. Aiful Corp. is the most heavily shorted stock of the 140 companies disclosed.

Gainers & Losers

Softbank Corp. led gainers in the Nikkei 225 index shares with a rise of 16.1% followed by increases in Mitsubishi Rayon Co. of 11.4%, in JTEKT Corp. of 10.7%, in Konami Corp. of 7%, and Dentsu Inc. of 6.7%.

Tokai Carbon Co. led decliners in the Nikkei 225 index shares with a fall of 10.9% followed by losses n Okuma Corp. of 10.3%, in Nippon Mining House of 9.5%, in Taiheiyo Cement of 8.3% and Toyota Motor Corp. of 8.2%.

Nippon Mining House fell after metal prices declined. Gold prices fell $13.30 to $732.2 per ounce, while crude oil prices for December delivery fell 1.3% to $58.55 per barrel. Mitsubishi Corp plunged 8.1% and Mitsui & Co. shed 4.6%.

Earnings Review

Inpex Holdings reported today that net income in the six months ending September 30 rose 25.2% to 104 billion yen from 81 billion yen from the same period a year ago.

Net sales rose to 741 billion yen from 554 billion yen a year ago as sales of crude oil and natural gas rose 33.6% to 478 billion yen and 35.6% to 248 billion yen respectively.

The company however lowered its profit forecast for the full year through March to 150 billion yen from 177 billion yen projected in August.

Full-year sales are forecasted to slip to 1.1 trillion yen from 1.3 trillion earlier forecasted. The revision is based on crude oil prices of $65 per barrel. The stock dropped 5.4%.