Japan Stocks Sturggle

123jump.com Staff
28 Apr, 2009
New York City

Tokyo stocks are expected to trade lower after U.S. bank trade lower and more deaths are linked to swine flu in the U.S. and Mexico. March retail sales declined at a slower pace in February but sales at large department and supermarket fell at 8.1% for the second month in a row.

[R]6:30 PM New York, 7:30 AM Tokyo – Tokyo stocks are expected to trade lower after U.S. bank trade lower and more deaths are linked to swine flu in the U.S. and Mexico. March retail sales declined at a slower pace in February but sales at large department and supermarket fell at 8.1% rate matching the decline in February.[/R]

Tokyo stocks are expected to decline in trading as more worries about U.S. bank health surface. Regulators have asked Citigroup and Bank of America to seek more capital which both banks are disputing.

On Monday, The Nikkei 225 Stock Average declined 232.57 or 2.7% to 8,493.77 and the broader Topix index declined 2.5% to 811.99.

Shikibo Ltd soared 40% on the speculation that demand for antiviral textiles will surge and medical mask makers Fujibo Holdings and Daiwabo Co. surged 33% and 28%.

Traders and analysts debated the direction of global economy and the impact of swine flu pandemic. While the flu is still restricted to few countries but on Tuesday more cases of flu linked deaths were reported in Mexico and in the U.S.

The Ministry of Economy, Trade and Industry reported that retail sales in March declined 3.9% from a year ago after falling at 5.7% rate in February. The monthly decline was the sharpest since the retail sales began falling in January 2008.

Sales of apparel and automobiles declined and fuel sales fell too. Retail sales at large department stores dropped 8.1% matching the decline for the second month in a row.

Gainers & Losers

Sharp dropped nearly 9% after it estimated profit in the current fiscal year which skeptical investors failed o agree. Weak yen and worries about earnings in the first half of the year dragged steel and exports oriented stocks.

Exporters led the decliners in Tokyo trading. Sony Corp declined 3.4% to 2,455 yen, Toyota declined 3.4% to 3,660 yen and Cannon Inc lost 4% to 2,780 yen.

Ship liners declined after the Baltic Dry Index weakened in Friday trading. Kawasaki Kisen Kaisha Ltd. dropped 6.7% to 360 yen, Mitsui O.S.K. Ltd. punged 7.5% to 544 yen and Nippon Yusen plummeted 8.3% to 388 yen.

Earnings Review

Nippon Steel Corp declined 5.3% or 18 yen to 326 yen after it reported net annual sales in fiscal year ending in March declined 1.2% to 4.77 trillion yen and net income fell 56% to 155 billion yen or $1.5 billion. Earnings per share declined to 23.71 yen from 53.5 yen.

The company declared dividend of 1 yen a share for the second half of the year and for the full year dividend of 6 yen compared to 11 yen in the previous year.

For the current fiscal year company estimated sales to decline 42.4% to 1.5 trillion yen and for the full year estimated sales to fall 26.6% to 3.5 trillion. For the fiscal half company estimated a loss of 60 billion yen and brake even for the year.

Honda Motor Co., Ltd, Japan’s second- largest carmaker said fourth quarter sales fell 41.6% to ¥1.784 trillion from ¥3.056 trillion a year ago. Net loss was ¥186.1 billion compared to net profit of ¥25.4 billion a year ago.

Net sales for the year 2008 fell 16.6% to ¥10.01 trillion from ¥12.00 trillion a year ago. Net income for the year fell 77% to ¥137.01 billion or ¥75.50 per diluted share compared to net income of ¥600.04 billion or ¥330.54 per share a year ago.

Daiwa Securities Group Inc, Japan’s second-largest brokerage said fourth quarter revenues fell 45.6% to ¥78.43 billion from ¥144.27 billion a year ago. Net loss was ¥17.36 billion compared to net loss of ¥12.93 billion a year ago.

Net sales for the year 2008 fell 49.9% to ¥413.94 billion from ¥825.42 billion a year ago. Net loss for the year was ¥85.04 billion or ¥63.16 per diluted share compared to net income of ¥46.41 billion or ¥33.63 per share a year ago.

The Norinchukin Bank, Japan’s largest lender to farmers and fishermen said full-year net loss was ¥570 billion or compared to net profit of ¥272 billion a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 232.57 or 2.67% to 8,493.77, Hang Seng index in Hong Kong decreased 285.31 or 1.92% closed to 14,555.11, CSI 300 index in China higher 5.24 or 0.21% closed to 2,518.53. ASX 200 index in Australia decreased 23.20 or 0.62% closed to 3,708.40. The KL Composite index in Malaysia lower 14.42 or 1.47% closed to 965.70.

The Kospi Index in South Korea decreased 39.59 or 2.95% to close at 1,300.24. SET index in Thailand closed lower 2.27 or 0.48% to 472.72 and JSE Index in Indonesia increased 19.83 or 1.26% closed to 1,595.92. The Sensex index in India decreased 370.10 or 3.25% closed to 11,001.75.