BoJ Lowers Outlook; Mizuho Prices Offering

Mayank Mehta
15 Jul, 2009
New York City

Mizuho Financial set the 530 billion yen offering price at 184 yen a share. The Bank of Japan extended by three months its emergency lending program to December and lowered its economic outlook for this year and the next year.

[R]7:00 PM Tokyo, 5:00 AM New York – Mizuho Financial set the 530 billion yen offering price at 184 yen a share. The Bank of Japan extended by three months its emergency lending program to December and lowered its economic outlook for this year and the next year.[/R]

The Bank of Japan lowered its economic outlook for the current and next year and said that companies are still struggling on weak financial conditions. The central bank extended its emergency direct lending program to corporations for three more months till the end of the year.

The Bank of Japan has been buying commercial paper and bonds after it lowered its interest rate to historic low of 0.1%. So far the bank has loaned 473 billion yen to corporations.

The central bank now estimates deeper economic contraction this year of 3.4% from the previous estimate of 3.1% and the economy to expand slower at 1% from the previous estimate of 1.2% in the next financial year.

The Nikkei 225 Index in Tokyo closed higher 7.44 or 0.08% to 9,269.25. Of the stocks in the index, 121 increased, 93 decrease and 11 were unchanged.

The opposition party, DPJ ahead of election said that it supports the central bank independence and an independent poll reported by Daily Yomiuri.

Gainers & Losers

Dowa Holdings soared 6.8% to 375 yen. The zinc smelter surged after the international prices of copper, zinc and nickel increased in London and Shanghai. Nippon Mining Holding increased 2.6% to 443 yen.

Mizuho Financial Group Inc declined 4.6% to 189 yen ahead of its public offering of 3 billion shares. The most active stock in Tokyo trading declined ahead of its price setting for the offering. Nomura Holdings declined 1% to 707 yen. After the close the bank set the price of offering at 184 yen a share.

Nippon Yusen KK increased 3.4% to 398 yen after the international freight rate index, the Baltic Dry index increased 4.1% after falling for two weeks in a row. Mitsui OSK increased 2.2% to 574 yen and Daiichi Chuo KK soared 5% to 250 yen.

Mitsui Fudosan Company dropped 2.2% to 1,508 yen and Sumitomo Realty declined 1.7% to 1,551 yen and Mitsubishi Estate declined 2.1% to 1,405 yen.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 7.44 or 0.08% to 9,269.25, Hang Seng index in Hong Kong increased 372.93 or 2.09% to 18,258.66 and CSI 300 index in China closed higher 38.55 or 1.12% to 3,493.30. ASX 200 index in Australia increased 57.40 or 1.48% to 3,924.50. The FTSE Bursa KL Composite index in Malaysia closed higher 17.61 or 1.63% to 1,097.24.

The Kospi Index in South Korea increased 35.30 or 2.55% to close at 1,420.86. SET index in Thailand closed higher 10.11 or 1.75% to 587.86 and JSE Index in Indonesia increased 66.70 or 3.24% to 2,123.28. The Sensex index in India increased 399.54 or 2.88% to 14,253.24.

Nikkei 200 Average Movers

Mizuho Financial Group Inc led the decliners in the Nikkei 225 index of 4.5% followed by losses in Chuo Mitsui Trust Holdings Inc of 4.5%, in Shinsei Bank, Limited of 4.4%, in Meidensha Corp of 4.3% and in CSK Holdings Corporation of 3.2%.

Fuji Electric Holdings Co Ltd led gainers in the Nikkei 225 index with a rise of 8.2% followed by gains in Ebara Corp of 6.9%, in Dowa Holdings Co Ltd of 6.8% and Mazda Motor Corp of 5.6%.