Nikkei in Tokyo Surges 2.7%; Dai-ichi IPO

Darlington Musarurwa
22 Feb, 2010
New York City

The benchmark index in Tokyo surged nearly 3% on the inflation and manufacturing reports in the U.S. Exporters, resource stocks, trading companies and shippers led the gainers. Dai-ichi Mutual Life Insurance filed to raise $12 billion in initial public offering.

[R]5:00 AM New York, 7:00 PM Tokyo – The benchmark index in Tokyo surged nearly 3% on the inflation and manufacturing reports in the U.S. Exporters, resource stocks, trading companies and shippers led the gainers. Dai-ichi Mutual Life Insurance filed to raise $12 billion in initial public offering.[/R]

Japanese stock indexes climbed after U.S. consumer prices rose less than expected. The benchmark stock index surged nearly 3% after commodities and stocks in resource sector, shippers and electronics exporters increased.

Gold prices increased 0.3% to $1,122 per ounce and crude oil soared 0.5% to $80.20 per barrel.

In Tokyo trading Nikkei 225 Stock Average rose 2.7% or 276.89 to 10, 400.47, and the broader Topix Index advanced 2.2% to 908.68.

In the first section of the Tokyo Stock Exchange 8.1 billion shares worth 617 billion yen were traded and in the second section 130 million shares valued at 1.5 billion yen changed hands.

Of the Nikkei 225 index stocks, 221 rose, 1 fell, and 3 were unchanged. Hino Motors led gainers in the index shares with a rise of 5.8% followed by T&D Holdings gaining 5.1%.

Dai-ichi IPO

Dai-ichi Mutual Life Insurance Co. filed to raise 1.1 trillion yen in an initial public offering to finance purchases. In a filing with the Ministry of Finance the company set the initial price of the stock at 150,000 a share that may be listed as early as April 1 and price the share by March 19.

The second largest insurer plans to sell 4.6 million shares to domestic investors and 2.5 million to international investors.

U.S. Inflation Rise Lower than Expected, Mortgage Defaults

U.S. stocks in a directionless trading edged up after the Fed raised discount rate and increased the spread between fed funds rate. Consumer price index increased 0.2% in January, less than expected.

Mortgage delinquencies in the fourth quarter to December hovered near the rate in the third quarter even though the new entrants to the loan defaults declined. In the quarter, seasonally adjusted mortgages that late at least 30 days fell to 9.47% from 9.64% in the third quarter according to the latest data from the Mortgage Bankers Association.

Toyota Exec Considered Savings From Limited Recalls

Nikkei News reported today that a document obtained by the U.S. House Oversight and Government Reform Committee indicated that Toyota Motor Corp. chief executive for North American operations said the company saved $100 million by negotiating an agreement with U.S. safety regulators that led to a limited """"equipment"""" recall of Camry and Lexus ES350 vehicles.

The automaker has since recalled 6 million vehicles in the U.S.

Toyota President Akio Toyoda will appear before the committee on Wednesday.

Stock Movers

Shippers gained after the Baltic Dry Index that measures freight rates increased for the fourth day in a row. Mitsui O.S.K. Lines Ltd increased 3.7% to 587 yen and Nippon Yusen K.K. added 3.1% to 332 yen.

Toshiba, the maker of nuclear power plant increased 3.6% to 457 yen after Nikkei News reported that Kazakhstan and Japan may be nearing an agreement on nuclear energy. Kazakhstan has second-largest recoverable uranium deposits.

Commodities linked stocks gained. Nippon Mining Holdings Inc increased 3% to 447 yen and Mitsui & Co increased 3.9% to 1,405 yen and Itochu Corp added 4% to 729 yen.