Nikkei Adds 4%; CPI Drops, Unemployment Rises

123jump.com Staff
31 Jul, 2009
New York City

Stocks in Japan in weak trading advanced for the week and for the fifth month in a row. Mitsui Fudosan, the largest Japanese real estate operator earnings surged lifting stocks in the sector. Unemployment in June increased to six-year high and consumer price index declined in the month.

[R]9:00 PM Tokyo, 7:00 AM New York – Stocks in Japan in weak trading advanced for the week and for the fifth month in a row. Mitsui Fudosan, the largest Japanese real estate operator earnings surged lifting stocks in the sector. Unemployment in June increased to six-year high and consumer price index declined in the month.[/R]

The unemployment rate in June increased to 5.4%, record high since June 2003 an increase from 5.2% in May. Monthly wages declined 0.6% from a year ago to 463,013 yen according to the data released from the Labor Ministry.

Consumer prices in June declined 0.2% from May and dropped 1.8% from a year ago. The index declined 1.7% at annual rate excluding food and dropped 1.1% excluding food and energy.

The Nikkei 225 Index in Tokyo closed higher 191.62 or 1.89% to 10,356.83 and for the week and the month the index increased above 4%. The weekly and monthly gain in the bench mark index was driven by better than expected earnings and expectations of global recovery.

Gainers & Losers

Mitsui Fudosan soared 5% to 1,740 yen after net income jumped to 16.1 billion yen. Revenues in the quarter surged 10% to 311.5 billion yen and net income soared 148% to 16.1 billion yen.

The news of better than expected earnings at Mitsui Fudosan lifted stocks in the sector and Sumitomo Realty leapt 6.5% to 1,950 yen.

Fuji Heavy Industries Ltd dropped 7.5% to 382 yen after net sales in the first quarter declined 21% to 271 billion yen and net loss of 19.2 billion yen.

Nintendo Co Ltd dropped 4.6% to 25,590 yen after first quarter net fell 61% to 42.3 million yen and sales declined 40% to 253 billion yen. The company forecasted annual sales decrease of 2.1% to 1.8 trillion yen and net income increase of 7.5% to 300 billion yen. In the quarter the company sold 5.97 million “Nintendo DS” hardware and with installed base of 107.75 million units.

Sony surged 6.8% to 2,675 yen after it reported less than expected quarterly loss. The company cited strength in yen and falling sales in the U.S. and Europe for its loss.

Mitsubishi UFJ increased 4.8% to 568 yen after ordinary income decreased 7.1% to 1.33 trillion yen and net income increased 48.3% to 75.9 billion yen. The increase in securities valuations and lending income supported the earnings gain in the quarter.

Daiwa Securities increased 2.9% to 560 yen after net revenues increased 15.4% to 107 billion yen and net income surged 203.6% to 17.8 billion yen. Brokerage commission decreased 11% to 15,255 million yen mainly because daily average trading value on the Tokyo Stock Exchange decreased by 31.8% to 1,721.2 billion yen. Underwriting commission surged 438% to 24.5 billion yen.

Asahi Breweries, Ltd increased 1.4% to 1,505 yen after first quarter sales were unchanged at 670 billion yen and net income of 27.8 billion yen. The company estimated fiscal year ending in December revenues to increased 3.1% to 1.5 trillion yen and net income decline of 4.6% to 92 billion yen.

Nikkei 200 Average Movers

Fuji Heavy Industries Ltd led the decliners in the Nikkei 225 index of 7.5% followed by losses in Mazda Motor Corp of 6.0%, in Yahoo Japan Corporation of 3.5%, in Kuraray Co Ltd of 3.5% and in Nippon Mining Holdings Inc of 3.4%.

Mizuho Securities Co Ltd led gainers in the Nikkei 225 index with a rise of 14.1% followed by gains in Ajinomoto Co Inc of 9.2%, in Yamato Holdings Co Ltd 7.9% and Fukuoka Financial Group Inc of 7.5%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 191.62 or 1.89% to 10,356.83, Hang Seng index in Hong Kong increased 339.25 or 1.68% to 20,573.33 and CSI 300 index in China higher 99.80 or 2.75% to 3,734.62. ASX 200 index in Australia increased 53.60 or 1.28% to 4,244.00. The FTSE Bursa KL Composite index in Malaysia closed higher 14.24 or 1.23% to 1,174.90.

The Kospi Index in South Korea increased 22.55 or 1.47% to close at 1,557.29. SET index in Thailand closed higher 2.05 or 0.33% to 624.00 and JSE Index in Indonesia increased 25.10 or 1.09% to 2,323.24. The Sensex index in India increased 282.35 or 1.83% to 15,670.31.