Tokyo Indexes Fall; Weak Banks, Business Climate

Darlington Musarurwa
14 Dec, 2009
New York City

New condo for sales in Tokyo increased 10.8% in November. Japan

[R]5:00 AM New York, 7:00 PM Tokyo – New condo for sales in Tokyo increased 10.8% in November. Japan’s business conditions dropped in December according to the latest data from the Bank of Japan. Banks and ocean freight transportation carried led the decliners in Tokyo trading.[/R]

Japan stock indexes gained after Abu Dhabi offered $10 billion to Dubai to repay Nakheel PJSC Islamic bonds of $4.1 billion that are due today and $6 billion to pay for suppliers and contractors and loan interests.

Gains were trimmed by a report showing business conditions deteriorated more-than-projected in December, while more companies plan to cut spending than the September quarter.

In Tokyo trading Nikkei 225 Index fell 0.02% or 2.19 to 10,105.68, and the broader Topix Index dropped 0.4% to 885.08.

In the first section of the Tokyo Stock Exchange 8.6 billion shares valued at 527 billion yen were traded and in the second section 218 billion shares worth 2 billion yen changed hands.

Of the Nikkei 225 index stocks, 93 gained, 119 fell, and 13 were unchanged. Jtekt led gainers in the index shares with a rise of 4.3% followed by Minebea Co. Ltd rising 3.5%.

Tokyo Condo Rise 10.8% in November

Nikkei News reported today that Real Estate Economic Institute indicated Thursday that new condominiums on sale in the Tokyo metropolitan area jumped 10.8% to 3,648 units in November from a year ago.

The number of purchase contracts fell 0.3 percentage points to 2,508 units, or 68.6% of units arriving on the market from the previous month.

The REEI forecasts 4,000 new condo units will come to the market this month.

New condo releases in the western Kinki region, which includes Osaka, rose 21.7% on the year to 2,088 units, while purchase contracts were signed for 1,272 units, or 60.94%, down 1.5 percentage points from October.

The report notes that new condos for sale this month are expected to be around 1,800 units in the Kinki area.

Japan Business Conditions Fall in December

Bank of Japan reported today that business conditions for Japan’s large manufacturers dropped to minus 24 in the three months to December from minus 18 earlier forecasted.

Sentiment for medium-sized companies dropped to minus 30 from minus 31 previously projected and small-sized enterprises eased to minus 40 from minus 42 earlier estimated.

Conditions for large manufacturers dropped to minus 22. It was forecasted to drop to minus 19.

The BoJ also indicated that corporate profits will fall minus 16 in the current fiscal year ending in March 2010.

Big companies plan to slash capital spending by 13.8% this fiscal year from 10.8% a quarter earlier.

Gainers & Losers

Jtekt led advancers in the Nikkei 225 index stocks with a rise of 4.3% followed by gains in Minebea Co Ltd of 3.5%, in Fuji Electric House of 3.4%, in Japan Airlines of 3.2% and Fanuc Ltd. of 3.1%.

Sanyo Electric led decliners in the Nikkei 225 index stocks with a fall of 5.2% followed by losses in J Front Retailing of 3.6%, in Mitsubishi UFJ of 3.5%, in Obayashi Corp. of 3.3%, inn Heiwa Real Estate of 3.2%.

Mitsubishi UFJ fell 2.9% to 465 yen after Deutsche Bank AG downgraded the stock and Kawasaki Kisen slipped 2.4% to 241 yen.

Other Movers

Kajima Corporation the construction company added 1.1% to ¥184.00.

Kawasaki Kisen Kaisha, Ltd the ocean freight transportation carrier dropped 2.4% to ¥241.00.

Obayashi Corp the construction company fell 1.6% to ¥301.00.

Mitsubishi UFJ Financial Group, Inc dropped 2.8% to ¥442.00 after the bank priced a share sale at ¥428 billion on Monday and raise up to ¥1.03 trillion ($11.6 billion) to help meet stricter global capital requirements.

Financials were weak in trading. Mizuho Financial Group, Inc the lender dropped 1.8% to ¥156.00 and Nomura Holdings, Inc the brokerage fell 2.0% to ¥663.00.

Taisei Corp closed the construction company closed unchanged at ¥159.00.