BoJ Lends to Companies; Panasonic Bonds

123jump.com Staff
04 Mar, 2009
New York City

Stocks in Japan edged higher as the Bank of Japan offers to lend directly to corporations. Banks are weary of increasing lending to companies. Investors are looking for China to expand stimulus package.

[R]5:00AM New York, 7:00PM Tokyo – Stocks in Japan edged higher as the Bank of Japan offers to lend directly to corporations. Banks are weary of increasing lending to companies. Investors are looking for China to expand stimulus package.[/R]

The benchmark stocks index rose 0.9% in Japan on optimism that Beijing will expand its stimulus package to cover sectors that were not covered under the earlier Rmb4 trillion plan.

Steel stocks rose.

In Tokyo trading Nikkei 225 index rose 0.9% or 61.24 to 7,290.96, and the broader Topix Index increased 0.7% or 5.24 to 732.04.

In the first section of the Tokyo Stock Exchange 8.7 billion shares worth 527 billion yen were traded and in the second section 59 million shares valued at 732 million yen changed hands.

Of the Nikkei 225 index stocks, 158 rose, 57 declined, and 10 were unchanged. Sumitomo Osaka led gainers in the index shares with a rise of 9%.

BoJ Offers to Buy 150 billion Yen Corporate Bonds

The Bank of Japan has offered to buy 150 billion yen in corporate bonds from lenders as banks are still reluctant to increase lending.

The BoJ plans to buy one trillion yen in corporate bonds from financial institutions through the end of September and will buy debt rated at least A and have a maturity date of up to a year.

Panasonic Bond Sale

Panasonic Corporation will issue unsecured bonds in Japan to raise 400 billion yen in three series, with maturities of three, five and ten years in that order.

The first series, maturing on March 2012 will raise 100 billion yen and have a coupon rate of 1.140%, the second series of 200 billion yen will have a coupon rate of 1.404% and its maturity date will be March, 2014.

In addition, the third series of 100 billion yen will have a coupon rate of 2.050% and matures on March 2019.

Proceeds from the bond issue will be used to finance capital expenditures and buy investment securities.

Gainers & Losers

Sumitomo Osaka led advancers in the Nikkei 225 index shares with a rise of 9% followed by increases in Isuzu Motors 7.5%, in Hitachi Construction Machinery of 7.4%, in Fujitsu Ltd. of 6.2%, and NSK Ltd. of 6.2%.

Steelmakers increased on expectations that China will expand its Rmb4 trillion to other sectors. Japan Steel Work gained 5.8%.

CSK Holdings led decliners in the Nikkei 225 index shares with a drop of 25.4% followed by losses in Clarion Co. Ltd of 7%, in Nomura Holdings of 4.7%, in T&D Holdings of 3.9%, and Honda of 3.5%.

Honda fell on news the company might seek financing to support its operations.