Japan Awaits Inflation, Unemployment Reports

123jump.com Staff
26 Aug, 2009
New York City

Stocks in cautious trading edged higher ahead of national election and two economic reports. The benchmark index is hovering at stretched valuation ahead of reports on inflation and unemployment. The DJP party is leading in polls ahead of national election on Aug 30. Toyota lowers production target.

[R]9:00 PM Tokyo – Stocks in cautious trading edged higher ahead of national election and two economic reports. The benchmark stock index is hovering at stretched valuation ahead of reports on inflation and unemployment. The DJP party is leading in polls ahead of national election on Aug 30. Toyota lowers its target for global vehicle output by 1 million.[/R]

Japan is scheduled to vote on for the members of lower house of lawmakers and ruling party Liberal Democratic Party is trailing in the opinion polls. The Democratic Party of Japan is likely to win at least 290 seats in the lower house with 480 members. The LDP has been out of power only once in the last 54 years.

The Nikkei 225 Index in Tokyo closed higher 142.35 or 1.36% to 10,639.71 as valuations remain stretched.

The reports on consumer price inflation and unemployment rate for July are expected to be released in the morning tomorrow. The unemployment is expected be near 5.4% rate in June and prices are expected to fall more than 2%.

Gainers & Losers

Toyota Motor increased 1.5% to 4,110 yen after it plans to shut assembly plant in Japan and cut global output by one million units.

Japan Airlines Corp increased 1.2% to 171 yen after Kyodo News reported that the airliner is expected to cut 5,000 or 10% of its staff.

Sanyo Electric decreased 0.4% to 262 yen after it plans to offer early retirement to many of its staff.

Exporters increased on the rise in the U.S. consumer confidence. Nikon Corp surged 5.1% to 1,640 yen and

Paper companies increased on the hopes that further declines in crude oil prices will lower operating costs. Oji Paper Co surged 2.9% and Nippon Paper Group increased 3.3%.

Noritz Corp surged 10% t0 1,299 yen after Credit Suisse analysts recommended the stocks of water heater maker on the hopes that the DPJ victory in the national election may offer government incentives to replace old boilers. The news was first reported on Bloomberg News.

Orix Corp increased 4.9% to 6,850 yen after 40 financial companies are expected to commit 30 billion yen to a public private partnership program to support several faltering realty companies.

Nikkei 200 Average Movers

Isuzu Motors Ltd led the decliners in the Nikkei 225 index of 3.1% followed by losses in Pioneer Corp of 2.8%, in Hino Motors Ltd of 2.1%, in Unitika Ltd of 2.0% and in Sekisui House Ltd of 1.3%.

Mitsubishi Materials Corp led gainers in the Nikkei 225 index with a rise of 6.4% followed by gains in Citizen Holdings Co Ltd of 6.3%, in Hokuetsu Paper Mills Ltd of 5.5% and in Nikon Corp of 5.0%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 142.35 or 1.36% to 10,639.71, Hang Seng index in Hong Kong increased 21.08 or 0.10% to 20,456.32 and CSI 300 index in China higher 62.56 or 2.01% to 3,172.39. ASX 200 index in Australia increased 48.70 or 1.11% to 4,454.50. The FTSE Bursa KL Composite index in Malaysia closed higher 1.47 or 0.13% to 1,172.56.

The Kospi Index in South Korea increased 12.74 or 0.80% to close at 1,614.12. SET index in Thailand closed higher 2.82 or 0.43% to 658.28 and JSE Index in Indonesia decreased 0.43 or 0.02% to 2,380.09. The Sensex index in India increased 81.38 or 0.52% to 15,769.85.