Tokyo Stocks Down; Mizuho, Daiwa Offerings

Darlington Musarurwa
29 Jun, 2009
New York City

Tokyo benchmark index fell 1% Daiwa Securities planned to raise $2.4 billion and Mizuho Financial Group plans to raise $6.2 billion. The industrial production index in May increased 5.9% in Japan. Shipping lines, brokerages and real estate companies led the decliners.

[R][5:00AM New York, 7:00PM Tokyo – Tokyo benchmark index fell 1% Daiwa Securities planned to raise $2.4 billion and Mizuho Financial Group plans to raise $6.2 billion. The industrial production index in May increased 5.9% in Japan.[/R]

Japan market averages fell 1% for the first time in four days as investors worried about the health of the global economy. Energy stocks fell as crude oil prices tumbled 1.6% to $69.20 per barrel.

However, paper companies and utilities trimmed losses on falling oil prices.

In Tokyo trading Nikkei 225 Index lost 1% or 93.92 to 9,783.47, and the broader Topix Index slipped 1.2% or 11.48 to 915.32.

In the first section of the Tokyo Stock Exchange 22.4 billion shares valued at 1.5 trillion yen were traded and in the second section 843 million shares worth 7 billion yen changed hands.

Of the Nikkei 225 index stocks, 44 gained, 167 fell, and 14 were unchanged. Yokogawa Electric led gainers in the index shares with a rise of 7% on falling crude oil prices.

Industrial Production Rises 5.9% in May

Japan’s Ministry of Economy, Trade and Industry reported today that the country’s industrial production index gained 5.9% to 79.2 in May from the previous month and fell 29.5% from a year ago.

Industries that contributed to the increase were transport equipment, electronic parts and devices, and steel and iron, in that order.

Commodities that mainly contributed to the increase are large passenger cars, portable telephone, drive and transmission and control parts.

The METI noted that the survey of production forecast in manufacturing showed that production is expected to gain 3.1% in June and 0.9% in July.

Industries that contributed to the June increase were general machinery, electronic parts and devices, information and communication electronics equipment, in that order.

In addition, industries that are expected to contribute to the increase in July are transport equipment, steel and iron, information and communication electronics equipment.

Shipments in May increased 4.5% from the previous month, showing an increase for the third consecutive month, but dropped 30% from the same period a year earlier.

Transport equipment, electronic parts and devices, information and communication electronics equipment, correspondingly contributed to the increase.

Inventory fell 0.6% in May from the previous month, falling for the fifth straight month, and shed 8.3% from a year earlier weighed by information and communication electronics equipment, chemicals, electronic parts and devices, in that order.

Daiwa to Raise 240 billion yen in Share Sale

Daiwa Securities reported on Friday last week it will raise an estimated 240 billion yen in a cash from investors. The company currently seeks to broaden its retail business.

Mizuho Plans on Share Issue

Separately, Bloomberg News reported today that Mizuho Financial Group Inc is planning to sell 600 billion yen of shares this week.

Gainers & Losers

Brokerage firms declined after Daiwa proposed to raise capital. Daiwa Securities Group fell 12% to 587 yen, Nomura Holdings dropped 4.2% to 796 yen and Mizuho Financial declined 4.2% to 229 yen. Mizuho Securities fell 2.6% to 296 yen.

Utilities and paper companies rose as crude oil prices slumped 1.6% to $69.2 per barrel. Yokogawa Electric advanced 7%. Oji Paper Co. advanced 2.2% and Hokuetsu Paper edged up 0.9%.

Energy stocks declined. Sumitomo Metal Mining dropped 4.6%, Nippon Mining House fell 4.1% and Mitsui & Co. tumbled 3.5%.

Shipping lines fell. Kawasaki Kisen plunged 3.4% to 398 yen and Mitsui O.S.K Lines tumbled 3.1% to 618 yen.

Real estate companies declined as well. Tokyu Land Corp dropped 5.8% to 434 yen and Heiwa Real Estate fell 3.7% to 313 yen.

Nikkei 200 Average Movers

Daiwa Securities Group Inc led the decliners in the Nikkei 225 index of 12.1% followed by losses in Meidensha Corp of 11.7%, in GS Yuasa Corporation of 10.6%, in Tokyu Land Corp of 5.8% and in Sumitomo Trust & Banking Co Ltd of 4.8%.

Yokogawa Electric Corp led gainers in the Nikkei 225 index with a rise of 7.0% followed by gains in Takashimaya Co Ltd of 4.4%, in J Front Retailing Co Ltd of 4.3% and Nippon Paper Group Inc of 3.0%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 93.92 or 0.95% to 9,783.47, Hang Seng index in Hong Kong decreased 71.75 or 0.39% to 18,528.51, CSI 300 index in China higher 51.55 or 1.65% to 3,179.97. ASX 200 index in Australia decreased 16.90 or 0.43% to 3,886.90. The KL Composite index in Malaysia closed higher 0.07 or 0.01% to 1,075.84.

The Kospi Index in South Korea decreased 6.08 or 0.44% to close at 1,388.45.SET index in Thailand closed higher 5.80 or 0.97% to 601.60 and JSE Index in Indonesia decreased 6.48 or 0.32% to 2,033.72. The Sensex index in India increased 21.10 or 0.14% to 14,785.74.