Insurers Lead Tokyo Gainers; Aioi Surges

Darlington Musarurwa
09 Nov, 2009
New York City

Japan foreign currency reserves rise to $1.05 trillion in October. Property and casualty insurance stocks rise after Mitsui Sumitomo and Aioi Insurance lift annual earnings outlook. Softbank Mobile leads the industry with net new subscribers of 97,500. JAL executives to forgo December pay.

[R]5:00 AM New York, 7:00 PM Tokyo - Japan foreign currency reserves rise to $1.05 trillion in October. Property and casualty insurance stocks rise after Mitsui Sumitomo and Aioi Insurance lift annual earnings outlook. Softbank Mobile leads the industry with net new subscribers of 97,500. JAL executives to forgo December pay.[/R]

Japan stock indexes were mixed after gains by insurance companies were pared by negative earnings forecasts.

In Tokyo trading Nikkei 225 Index rose 0.2% or 19.64 to 9,808.99, and then broader Topix Index fell 0.4% or 870.67.

In the first section of the Tokyo Stock Exchange 7.7 billion shares valued at 517 billion yen were traded and in the second section 597 million shares worth 3.8 billion yen changed hands.

Of the Nikkei 225 index stocks, 82 rose, 137 dropped, and 5 were unchanged. Mitsui Sumitomo Insurance Group Holdings led advancers in the index shares with a rise of 8.6% after its first half profit surprisingly rose to 57 billion yen on small payouts.

The yen gain as much as 89.69 against the dollar before falling to 90.10.

Japan’s Reserve Rise to $1 trillion in October

Japan’s ministry of finance reported today the country’s reserve assets rose $4.1 billion from the end of September to $1.05 trillion at October 31.

According to the report, official reserve assets stood at $1 trillion, IMF reserve position $4.4 billion, SDRs $21 billion, gold $25 billion, and other reserve assets $400 million.

Softbank Mobile Adds 97,500 New Subscribers

Softbank Mobile Corp., a unit of Softbank Corp., reported today that it has gained 97,500 net new subscribers in October after adding net new 108,000 subscribers the previous month.

The company gained most net subscribers than its rivals.

NTT DoCoMo Inc’s net new subscribers fell to 55,100 from 66,000 a month earlier, while KDDI Corp net new subscribers fell to 27,500 from 102,300 in the previous month.

Japan Executives to Forgo December Pay

Nikkei News reported today Japan Airlines Corp. president Haruka Nishimatsu and other board members will forgo their December month pay.

The airline has been cutting executive pay and is currently waiting for support from the Enterprise Turnaround Initiative Corporation of Japan.

Gainers & Losers

Aioi Insurance Company surged 8.7% to 427 yen after it estimated higher annual earnings.

Mitsui Sumitomo Insurance Group Holdings led advancers in the Nikkei 225 index stocks with a rise of 8.6% followed by increases in Kubota Corp. of 8%, in Citizen Holdings of 7.8%, in Furukawa Electric Co. of 6.9%, and Minebea Co. Ltd of 5.3%.

Mitsui Sumitomo Insurance Group rose after the insurer reported that its profit in the first half ended September 31 rose to 57 billion yen, more than analysts had forecasted.

Citizens Holdings Co added 7.8% to 526 yen after it lifted its annual earnings outlook to 5.5 billion yen, 83% rise from a year ago.

Furukawa Electric and other utilities advanced after crude oil prices fell 2.8% to $77.4 per barrel.

Toray Industries led decliners in the Nikkei 225 index stocks with a decline of 4.9% followed by losses in Credit Saison Co. of 4.7%, in Mitsubishi Rayon Co. of 4.6%, Toppan Printing of 4.6%, and Ajinomoto of 3.9%.

Earnings Review

Aioi Insurance Company, Limited, an insurance company said first-half lowered outlook for ordinary income from ¥520.0 billion to ¥518.9 billion. Ordinary profit rose from ¥7.0 billion to ¥27.6 billion. Net profit rose from ¥3.0 billion to ¥17.1 billion and earnings per share from ¥4.08 to ¥23.25 for the fiscal year ending March 2010.

Citizen Holdings Co., Ltd, the manufacturer of watches said first-half sales fell 28.5% to ¥119.7 billion from ¥167.3 billion a year ago. Net profit for the first-half fell 82% to ¥1.10 billion compared to net profit of ¥6.17 billion a year ago.

Mitsubishi Rayon Company, Limited, the manufacturer of rayon staple said first-half revenues fell 24.5% to ¥149.8 billion from ¥198.3 billion a year ago. Net loss for the first-half was ¥9.8 billion compared to net profit of ¥126 million a year ago.

Nippon Telegraph and Telephone Corporation, the telecommunications company said first-half revenues fell 3% to ¥5.0 trillion from ¥5.16 trillion a year ago. Net profit for the first-half fell 30.5% to ¥282.24 billion or ¥213.29 per diluted share compared to net profit of ¥406.4 billion or ¥29,938.86 per share a year ago.

Tokio Marine Holdings, Inc, an insurance company said first-half outlook rose for ordinary income from ¥1.66 billion to ¥1.87 billion. Ordinary profit outlook increased from ¥60.0 billion to ¥104.0 billion. Net profit view increased from ¥40.0 billion to ¥71.0 billion and earnings per share from ¥50.78 to ¥90.15 for the fiscal year ending March 2010.