Service Industry In Japan Shrinks

Darlington Musarurwa
16 Feb, 2010
New York City

Stock in Japan closed nearly unchanged and service industry shrank in December. Banks receive 20,000 applications under debt moratorium law. The Japanese government and the Bank of Japan agree on the inflation target of 1%.

[R]5:00 AM New York, 7:00PM Tokyo – Stock in Japan closed nearly unchanged and service industry shrank in December. Banks receive 20,000 applications under debt moratorium law. The Japanese government and the Bank of Japan agree on the inflation target of 1%.[/R]

Japanese stock indexes gained on broker upgrades on selected stocks, raising expectations corporate earnings will be healthy.

In Tokyo trading Nikkei 225 Stock Average increased 0.2% or 20.95 to 10,034.25 and the broader Topix Index increased 0.2% to 885.17.

In the first section of the Tokyo Stock Exchange 8.5 billion shares worth 379 billion yen were traded and in the second section 261 million shares valued at 3 billion yen changed hands.

Of the Nikkei 225 index stocks, 110 rose, 92 fell, and 23 were unchanged. Taiheiyo Cement led gainers in the index shares with a rise of 3.7% followed by All Nippon Airways gaining 3.1%.

The tertiary index in December the measure of service industry declined 0.9% from November according to the Trade Ministry.

Banks Receive 20,000 Loan Modification Applications

Japan Today reported today nine banks operating under the umbrella of six major banking groups received 19,560 applications for easing loan repayment terms for small and midsize companies by the end of December.

Of the total applications, 20% with 888.3 billion yen loans were approved.

Bank of Tokyo-Mitsubishi UFJ received the highest number of applications with 6,504, involving 266.3 billion yen and 1,667 of them worth 93.3 billion yen were approved.

The debt moratorium law that took effect December 4 allows moratoriums of debt owed by smaller businesses and homeowners to support those affected by the global financial crisis.

Government, BoJ Target 1% Inflation Rate

Nikkei News reported today Finance Minister Naoto Kan said the Japanese government and the Bank of Japan have agreed for the country’s prices to increase at a rate of 1% as authorities ratchet up efforts to fight deflation.

""Whether or not a rate of 1% is enough, we believe that we should set a policy target around there. I think there is a shared view that the target is around there"" between the government and the central bank,” said Kan during parliamentary testimony.

Nikkei Movers

Sumitomo Corporation led the decliners in the Nikkei 225 Stock Average with a loss of 4.3% followed by losses in Meidensha Corp of 2.7%, in Mazda Motor Corporation of 2.2%, in Tosoh Corporation 2.2% and in Hitachi, Ltd 1.9%.

Taiheiyo Cement Corp led gainers in the Nikkei 225 Stock Average with a rise of 3.7% followed by gains in All Nippon Airways Co., Ltd 3.1%, in Nippon Oil Corp of 2.9% and in Nippon Mining Holdings Inc of 2.6%.

Other Movers

Access Co decreased 0.2% to ¥114,500 after the developer of mobile-phone software and online browser software was downgraded to “underperform” from “outperform” at Tetsuya Nakamura.

All Nippon Airways Co added 3.1% to ¥265.00 after the carrier was upgraded to “buy” from “hold” at Naoko Matsumoto.

Amada Co advanced 3.7% to ¥667.00 after the maker of steel-sheet processing machinery was upgraded to “buy” from “neutral” at Nomura Holdings Inc.

Idemitsu Kosan Co., Ltd climbed 6.1% to ¥6,770.00 after the oil refiner was upgraded to “outperform” from “market perform” at Reiji Ogino.

Koito Manufacturing Co fell 2.6% to ¥1,155.00 after the auto-parts company was downgraded to “equalweight” from “overweight” at Morgan Stanley.

Matsuya Co. increased 1.4% to ¥739 after the department store chain reported nine-month loss of ¥2.75 billion compared to ¥2 million in the period a year ago.

Nichii Gakkan Co rose 2.4% to ¥870 after the hospital administration provider was upgraded to “outperform” from “market perform” at Katsumi Arai.

Takasago Thermal Engineering Co dropped 4.8% to ¥683.00 after the builder of air-conditioning facilities was downgraded to “underperform” from “market perform” at Toshiya Mizutani.