Tokyo Stocks Down; Sanyo Plunges 20%

Darlington Musarurwa
05 Nov, 2009
New York City

Stocks in Japan closed lower on weak earnings and a rise in energy prices dragged chemical makers. Sanyo Electric plunged 20% after Panasonic offered 40% lower than the closing price. Toyota Motor first net plunges but it lowered annual loss to 200 billion yen.

[R]5:00 AM New York, 7:00 PM – Stocks in Japan closed lower on weak earnings and a rise in energy prices dragged chemical makers. Sanyo Electric plunged 20% after Panasonic offered 40% lower than the closing price. Toyota Motor first net plunges but it lowered annual loss to 200 billion yen.[/R]

Japanese stocks fell as weak corporate earnings dampened investors’ enthusiasm and set of worries of a prolonged and uneven economic recovery.

In Tokyo trading Nikkei 225 Index declined 1.3% or 126.87 to 9,717.44 and the broader Topix Index fell 0.7% or 874.96.

In the first section of the Tokyo Stock Exchange 9.8 billion shares worth 571 million yen were traded and in the second section 658 million shares valued at 4.6 billion yen changed hands.

Of the Nikkei 255 index stocks 48 rose, 168 fell, and 9 were unchanged. Denki Kagaku led advancers in the index shares with a rise of 7.1% followed by Inpex Corp. increasing 5.3% after crude oil prices advanced 1% to $80.4 per barrel.

Toyota H1 Profit Falls

Toyota Motor Co. reported today that net income in the first six months ended September dropped to 56 billion yen from 493.4 billion yen a year ago.

Net revenues in the first half dropped 31% to 8.4 trillion yen and operating income declined 718.9 billion yen.

Vehicle sales in the period fell by 1.12 million units to 3.13 million units.

Toyota forecasts that consolidated vehicle sales will increase to 7.03 million units from the previously forecasted 6.60 million units in the fiscal year ending March 31, 2010.

Consolidated revenues are expected to rise to 18 trillion yen and net income has been revised to a loss 200 billion yen from the previous estimate of 450 billion yen loss.

Toyota executive vice president Ichimaru said, “However, outlook for global vehicle demand still remains uncertain.”

Small Companies Support Debt Relief

Nikkei News reported today that a survey released by Teikoku Databank Ltd. indicated that 10% of Japanese companies will consider taking advantage of the debt moratorium plan.

The survey involved 21,491 companies and many of them complained of refinancing difficulties. Of the respondents, 38.3% opposed the proposed moratorium and 25.5% supported it.

Large companies were opposed to it but small companies supported it.

Gainers & Losers

Acom Corp, the largest consumer finance company surged 7.6% to 1,596 yen after Citigroup analyst revised his outlook on the industry stocks. Promise increased 15% to 786 yen.

Sanyo Electric plunged 20.4% after Panasonic offered to buy the company through a tender offer at 131 yen compared to its previous close price of 216 yen. Sanyo was the most active stock in Tokyo trading.

Panasonic dropped 4.7%.

Fuji Media decreased 3.3% to 129,100 yen after it lowered its annual earnings estimate by 41%.

A rise in energy prices dragged chemical companies lower. Mitsubishi Chemicals decreased 3.2% to 323 yen and Mitsui Chemical dropped 3.3% to 300 yen.

Inpex Corp increased 5.3% to 796,000 yen after a rise in crude oil prices.

Toyota Motor declined 0.8% to 3,580 yen after it lowered its annual loss expectations. The automaker also withdrew from Formula One that will save 50 billion yen a year.

Sony Corp, Hitachi Ltd and Casio Computer dropped at least 2%.