Weak Store Sales in Tokyo; Stocks Down

Darlington Musarurwa
23 Feb, 2010
New York City

Stocks in Tokyo trading edged lower. Resource stocks, commodities and export sensitive stocks closed lower. The yen edged higher. Shipping companies led the gainers. Convenience stores sales tumble 5% to 565.2 billion in January. Ad spending falls the most since 1947 in Japan.

[R]5:00 AM New York, 7:00 PM – Stocks in Tokyo trading edged lower. Resource stocks, commodities and export sensitive stocks closed lower. The yen edged higher. Shipping companies led the gainers. Convenience stores sales tumble 5% to 565.2 billion in January. Ad spending falls the most since 1947 in Japan.[/R]

Japan market averages closed lower in a weak trading after ad spending declined at the fastest pace in sixty years and convenience store sales dropped 5% in January.

Investors were also unnerved by a rising yen, which soared to 91.03 against the dollar.

In Tokyo trading Nikkei 225 Stock Average declined 0.5% or 48.37 to 10,352.10, and then broader Topix Index dropped 0.8% to 902.31.

In the first section of the Tokyo Stock Exchange 7.4 billion shares worth 516 billion yen were traded and in the second section 97 million shares valued at 1.2 billion yen changed hands.

Of the Nikkei 225 index stocks, 82 gained, 124 fell, and 19 were unchanged. Sanyo Electric led gainers in the index shares with a rise of 5.5% followed by Kajima Corp jumping 4.4%.

Japan Downgrades Export Assessment

Japanese government downgraded its assessment of exports to “increasing moderately” from “increasing” in its February report as Toyota recalled millions of vehicles with brake defects, according to a latest report from Nikkei News.

Toyota has recalled an estimated 9 million vehicles worldwide. There has also been moderating shipments to Asia.

In addition, Japan cut its view of imports to “picking up moderately” from “picking up.”

Overall economic assessment was left unchanged for the seventh consecutive month, and the economy remains in a “difficult situation.”

Convenience Store Sales Drop 5%

Japan Franchise Association reported today that convenience store sales declined 5.3% to 565.26 billion yen in January on same-store basis, the eighth monthly decline in a row.

Shopper visits to convenience stores fell 1.6% to 985.4 million.

Sales of food items consumed on a daily basis, including lunches, bread and rice balls, dropped at a smaller pace of 2.7% compared with December.

Ad Spending Falls 11.5% in 2009

Japan’s biggest advertising agency, Dentsu Inc said today spending on advertisements in Japan fell 11.5% to 5.92 trillion yen in 2009 from the previous year when ads decreased 4.7%, falling the most since 1947.

Ad spending on newspapers, magazines, television and radio tumbled 14.3%, with spending on newspaper ads plunging 18.6% to 673.9 billion yen, while outlays for TV ads plummeted 10.2% to 1.71 trillion yen.

Stock Movers

Mining and resource linked stocks lower tracking losses in commodities prices. Nippon Mining Holdings Inc decreased 2% to 438 yen and Sumitomo Corp dropped 1.1% to 973 yen.

Inui Steamship Co. increased 5.6% to 703 yen after it doubled its annual dividend to 10 yen a share and revised higher its annual earnings estimate.

Jtek dropped 6.6% to 934 yen after steering parts supplier may face higher costs and slower sales after Toyota may recall Corolla models fitted with company’s parts.

Kajima Corp increased 4.4% to 215 yen and Obayashi Corp increased 2.3% after Al-Ittihad newspaper in the UAE reported that Dubai government allocated $5 billion to Dubai World. The news was reported by Bloomberg.

Kawasaki Kisen Kaisha Ltd increased 3.5% to 326 yen after freight rate index inched higher in London trading and expectations of higher revenues in the sector.

Pioneer Corp declined 4.4% to 346 yen after the company planned to issue additional share to be priced before Feb 25.

Nikkei 200 Average Movers

Jtek Corporation led the decliners in the Nikkei 225 index of 6.6%, followed by gains Pioneer Corporation of 4.4%, in INPEX Holdings Inc. of 3.0%, in Asahi Glass Company, Limited of 3.0%, and in Denki Kagaku Kogyo Kabushiki Kaisha of 2.6%.

Sanyo Electric Co., Ltd. led gainers in the Nikkei 225 index with a rise of 5.5% followed by gains Kajima Corporation of 4.3%, in Kawasaki Kisen Kaisha, Ltd. of 3.4%, in GS Yuasa Corporation of 3.3%, and in IHI Corporation of 3.2%.