Japan Service Index Rises

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

Stocks in Tokyo surged on an unexpected rise in service index in January. The benchmark index closed up 3.2% on the report. Realty stocks surged for the second day in a row. Tokyo Land Co. surged 8.6% and Sumitomo Realty soared 8.2%. Mitsubishi UFJ Financial Group led financial with a rise of 8.2%.

[R]5:00AM New York, 7:00PM Tokyo - Japan’s demand for services rises 0.4% in January. Government’s economic assessment remains unchanged.[/R]

Tokyo stocks gained 3.2% after a government report showed that the country’s demand for services unexpectedly gained in January. The government’s economic assessment remained unchanged for the first time in six months.

In Tokyo trading Nikkei 225 index increased 3.2% or 244.98 to 7,949.13, and the broader Topix Index soared 2.6% or 18.95 to 760.64.

In the first section of the Tokyo Stocks Exchange 9.5 billion shares worth 573 billion yen were traded and in the second section 87 million shares valued at 1.1 billion yen changed hands.

Of the Nikkei 225 index stocks, 199 rose, 17 declined, and 9 were unchanged. CSK Holdings Corp. led gainers in the index shares with a rise of 15.6% followed by Credit Saison gaining 10.1%.

Demand for Services Rise 0.4% in January

Japan’s Ministry of Economy, Trade and Industry reported today the country’s indices of Tertiary Industry Activity, which measures demand for services, rose 0.4% to 106.4 in seasonally adjusted terms in January.

Industries that contributed to the increase include information and communications rising 4.3%; medical, health care and welfare 2.1%; compound services 11.2%; real estate 1.6%; wholesale and retail trade 0.3%; learning support 5%; and electricity, gas, heat supply and water 0.5%.

Industries that contributed to the decline were services 1%; eating and drinking places, accommodations 3.5%; transport 2.3%; and finance and insurance 0.4%.

Economic Assessment Unchanged

Japan Cabinet Office yesterday reported that the country’s economic conditions are worsening rapidly and are in a severe situation.

However, government overall economic assessment remained unchanged for the first time in six months after being downgraded for the five straight months to February.

Cabinet office says the lack of a downward revision doesn’t imply that economic conditions have stopped worsening.

The report also noted that corporate profits are ""decreasing very substantially"" in March from an assessment of ""falling substantially"" in the previous month.

According to the report, exports and industrial output is ""decreasing very substantially, while capital spending is ""decreasing."" The employment situation is ""getting worse rapidly"" and private consumption is ""decreasing modestly.""

Government forecasts that the economy will continue deteriorating in the interim.

Fiscal and Economic Policy Minister Kaoru Yosano said yesterday though the economic situation is severe, it didn’t warrant pessimism.

Gainers & Losers

CSK Holdings Corp. led gainers in the Nikkei 225 index shares with a rise of 15.6% followed by increases in Credit Saison Co. of 10.1%, in Sumco Corp. of 9.7%, in Pioneer Corp. of 9.4%, and Sapporo Holdings of 8.8%.

Realty stocks increased. Tokyo Land Co. surged 8.6% and Sumitomo Realty soared 8.2%.

Financial stocks advanced. Mitsubishi UFJ Financial Group of 8.2% and Sumitomo Trust & Banking soared 7.8%.

Casio Computer led decliners in the Nikkei 255 index shares with a fall of 5% followed by losses in Canon Co. 4.6%, in Toyobo Co. Ltd of 3.9%, in Mitsui Chemicals of 3.2%, and Kao Corp. of 3%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 244.98 or 3.18% to 7,949.13, Hang Seng index in Hong Kong decreased 98.62 or 0.76% closed to 12,878.09, CSI 300 index in China higher 80.79 or 3.60% closed to 2,322.40. ASX 200 index in Australia increased 103.50 or 3.09% closed to 3,451.90. The KL Composite index in Malaysia higher 0.99 or 0.12% closed to 841.87.

The Kospi Index in South Korea increased 38.42 or 3.41% to close at 1,163.88. SET index in Thailand closed lower 2.29 or 0.54% to 422.32 and JSE Index in Indonesia decreased 12.76 or 0.96% closed to 1,312.09. The Sensex index in India decreased 79.72 or 0.89% closed to 8,863.82.