Tokyo Stocks Surge 2.7%, Panasonic Loss

Darlington Musarurwa
04 Feb, 2009
New York City

Tokyo stocks charged ahead on the hopes that recent market share gains by the automakers in the U.S. will sustain exports. Panasonic third quarter operating profit declined 84% and sales dropped 20%. The company estimated loss of $4.2 billion and plans to cut 15,000 jobs.

[R]5:00AM New York, 7:00PM Tokyo - Asian carmakers increase U.S. market share to 49.5% in January. U.S. pending home sales advance 6.3% to 87.7 in December.[/R]

Stocks in Tokyo trading rose after the release of January U.S. auto sales. The weak sales in the month were in line with the expectations but Asian automakers increased market share to nearly 50%.

Investor sentiment was also boosted by news that an index of pending home sales in th U.S. increased 6.3% in December.

Gains were however capped by negative earnings results and full-year earnings downgrade by Panasonic Corp. and Mitsubishi Motors.

In Tokyo trading Nikkei 225 index rose 2.7% or 213.43 to 8,038.94, and the broader Topix Index advanced 2.5% or 18.99 to 792.78.

In the first section of the Tokyo Stock Exchange 8.4 billion shares worth 582 billion yen were traded and in the second section 104 million shares valued at 882 million changed hands.

Of the Nikkei 225 index stocks, 196 increased, 26 declined, and 3 were unchanged. Taiheiyo Cement led advancers in the index shares with a rise of 13.3% followed by Dowa Holdings increasing 11.1%.

Asian Carmakers U.S. Market Share Rise to 49.5%

Autodata Corp. reported yesterday that Asian carmakers market share in the U.S. rose to 49.5% in January. However, total vehicle sales in the U.S. slipped 37% to 656,976 units in the review period.

Toyota Motor sales fell 32% to 117,287 units, Honda Motor Co dropped 28% to 71,031 units and Nissan dipped 30% to 53,884 units.

Sales from Mitsubishi and Mazda also plunged 35% to 4,730 units and 27% to 15,420 units, respectively.

U.S. Pending Home Sales Rise 6.3% to 87.7 in December

U.S. National Association of Realtors reported yesterday that the pending home sales index advanced 6.3% to 87.7 from the upwardly revised 82.5 in November.

Pending home sales fell 1.7% to 62.1 in the Northeast, but increased 12.8% to 83.7 in the Midwest and advanced 13% to 96.8 in the South.

The Housing Affordability index rose 10.9% to 158.8 in December to 158.8.

NAR chief economist Lawrence Yun said, “Significant uncertainty still clouds the housing market despite improved affordability conditions. For a sustainable housing market recovery and, hence, sustainable economic recovery, we need a significant housing stimulus and mortgage availability for qualified borrowers.”

Gainers & Losers

Taiheiyo Cement led advancers in the Nikkei 225 index shares with a rise of 13.3% followed by increases in Dowa Holdings of 11.1%, in Sumitomo Metal Mining of 10.1%, in Suzuki Motor of 10.1%, and Kururay Co. Ltd. of 9.6%.

Nissan advanced 7.5% and Isuzu Motors edged up 8.7%.

Sumitomo Metal Industries rose after copper for March delivery gained 6.4%.

Panasonic led decliners in the Nikkei 225 index shares with a fall of 7.3% followed by losses in Shionogi & Co. of 4.8%, in Asahi Breweries of 4%, in Japan Tobacco of 3.3%, and Ajinomoto Co. Ltd of 2.6%.

Panasonic declined as the company''s operating profit slipped 84% to 26.4 billion yen in the three months to December.

Mitsubishi Motors Lost 4.76 billion yen

Mitsubishi Motors Corp. reported today that its net loss for the April to December period increased to 4.76 billion yen on declining global car sales and a stronger yen.

The automaker forecasts group net loss in 2008 fiscal year of 60 billion yen, the first loss in three years.

Mitsubishi also revised its projected group operating profit to 5 billion yen from 50 billion yen made earlier as sales are expected to ease to 2.01 trillion yen.

Panasonic Operating Profit Falls 84% in Q3

Panasonic reported today that its operating profit in the third quarter ended December 31 declined 84% to 26.4 billion from 165.4 billion yen in the comparable year ago period on a stronger yen, rising competition and weak consumer spending on both the domestic and international market.

Consolidated group sales in the period shed 20% to 1.9 trillion yen as domestic sales fell 10% to 1 trillion yen and overseas sales declined 29% to 865.5 billion yen.

The company estimated operating profit of 60 billion yen in the fiscal year ended March 31 from 340 billion yen projected on November 27.

Sales are expected to slip to 8.5 trillion yen from 7.7 trillion yen.