Business Investments in Japan Drop Again

Darlington Musarurwa
04 Mar, 2010
New York City

The benchmark index in Tokyo closed lower 1.1% on the worries that lower economic growth in China will slow exports. Business investments in Japan declined for the eleventh quarter in a row at the end of last year. Higher yen dragged exporters and automakers lower.

[R]5:00 AM New York, 7:00 PM Tokyo – The benchmark index in Tokyo closed lower 1.1% on the worries that lower economic growth in China will slow exports. Business investments in Japan declined for the eleventh quarter in a row at the end of last year. Higher yen dragged exporters and automakers lower.[/R]

Japan’s stock indexes fell after a government report noted a decline in business investments in the three months to December.

Preliminary estimates forecast that the economy rose 4.6% in the December quarter and the estimate is scheduled to be revised on March 11.

In Tokyo trading Nikkei 225 Stock Average decreased 1.1% or 107.42 to 10,145.72, and the broader Topix Index fell 0.9% to 897.64.

In the first section of the Tokyo Stock Exchange 17.2 billion shares worth 1.2 trillion yen were traded and in the second section 279 million shares valued at 3.8 billion yen changed hands.

Of the Nikkei 225 index stocks, 38 gained, 176 dropped, and 11 were unchanged. J Front Retailing led gainers in the index shares with a rise of 5.1% followed by Fuji Electric House jumped 4.7%.

Corporate Investment Drops 17.3%

Japan’s Ministry of Finance reported today that business capital expenditure declined 17.3% in the three months to December from the same period a year earlier. The decline was an eleventh quarterly drops in business investment and prompted fears of lowered GDP estimate on March 11.

Corporate investments in the previous quarter ending in September decreased 24.8%.

Ordinary profits in the period rose 102.2% from a year ago compared with a decline of 32.4% in the September quarter.

Sales fell 3.1% after decreasing 15.7% in the previous quarter.

Canon’s Stake Rises 71.3% in Oce NV

Canon Inc said today it has increased its stake in Dutch printer maker Oce NV to 71.3% from 28.3% after the tender offer for 8.6 euros a share that started on January 29 and ended March 1.

The company had earlier targeted 85% stake as it intends to make Oce a wholly owned unit. Canon will launch an additional offer between March 5 and March 19 at 8.6 euros a share.

Nikkei Movers

Mitsubishi Motors Corp led the decliners in the Nikkei 225 Stock Average with a loss of 10.6% followed by losses in Panasonic Electric Works Co., Ltd of 4.3%, in JGC Corp of 2.9%, in TDK Corp 2.9% and in JFE Holdings, Inc 2.9%.

J Front Retailing Co Ltd led gainers in the Nikkei 225 Stock Average with a rise of 5.0% followed by gains in Fuji Electric Holdings Co., Ltd 4.6%, in Mitsubishi Chemical Holdings Corp of 3.1% and in Sumco Corp 2.7%.

Other Movers

Higher yen in New York and Tokyo trading dragged stocks of exporters. Sony declined 1.1% to 3,100 yen, Nissan Motor Co dropped 1.1% to 694.00 yen, Olympus Corp declined 2.7% to 2,704 yen and Bridgestone Corp edged 1.6% lower to 1,515 yen.

Komatsu Ltd, the earth moving equipment maker decreased 1.4% to 1,805.00 yen and Hitachi Construction Machinery Co. declined 1.4% to 1,914 yen.

Mitsubishi Motors Corp plunged 10.6% to 118.00 yen after the car maker failed to agree on a joint venture with French car maker PSA Peugeot Citroen.

Higher yen in New York and Tokyo trading dragged stocks of exporters. Sony declined 1.1% to 3,100 yen, Nissan Motor Co dropped 1.1% to 694.00 yen, Olympus Corp declined 2.7% to 2,704 yen and Bridgestone Corp edged 1.6% lower to 1,515 yen.