Japan Jobless Rate at 4.9%; Production Down

Darlington Musarurwa
30 Mar, 2010
New York City

Stocks in Japan closed higher after February unemployment rate was unchanged at 4.9% in February and industrial production declined 0.9% in month. Steelmakers in Asia finalized their short term contracts with iron ore producers that track spot prices instead of annual price contracts.

[R]5:00 AM New York, 7:00 PM Tokyo – Stocks in Japan closed higher after February unemployment rate was unchanged at 4.9% in February and industrial production declined 0.9% in month. Steelmakers in Asia finalized their short term contracts with iron ore producers that track spot prices instead of annual price contracts.[/R]

Stocks in Tokyo trading rose after unemployment rate remained unchanged in February. The market was also lifted after U.S. consumer spending rose.

However, gains were limited after industrial production dropped in February.

In Tokyo trading Nikkei 225 Stock Average rose 1% or 110.67 to 11,097.14, and the broader Topix Index advanced 1.4% to 979.58.

In the first section of the Tokyo Stock Exchange 10.6 billion shares worth 679 billion yen were traded and in the second section 148 million shares valued at 2.5 billion yen changed hands.

Of the Nikkei 225 index stocks, 186 rose, 29 fell, and 8 were unchanged. Nippon Light Metal led gainers in the index shares with a rise of 5.3% followed by Nippon Soda gaining 5%.

Industrial Production Falls 0.9% in February

Japan’s Ministry of Economy, Trade and Industry said today the country’s industrial production index declined 0.9% to 91.3 in February from a month ago but rose 31.3% from a year earlier.

Industries that contributed to the decrease were transport equipment; other manufacturing; information and communication electronics equipment, in that order.

Commodities that mainly contributed to the decline were electronic and electric toys; active matrix LCDs (Liquid Crystal Devices) and small passenger cars, respectively.

According to the Survey of Production Forecast in Manufacturing, production is expected to increase 1.4% in March and to decrease 0.1% in April.

Industries that mainly contributed to the increase in March are electronic parts and devices; transport equipment and electrical machinery, correspondingly.

Industries that mainly contributed to the decrease in April are transport equipment; electronic parts and devices and iron and steel, in that order.

Shipments in February decreased 0.2% from the previous month, falling for the first time in twelve months. However, shipments rose 28.7% from the previous year.

Industries that mainly contributed to the decrease were chemicals, excluding drugs; information and communication electronics equipment and machinery, in that order.

The METI also said inventory increased 1% from the previous month in February lifted by information and communication electronics equipment; iron and steel; petroleum and coal products, respectively.

Unemployment Rate Unchanged at 4.9%

Japan’s Ministry of Internal Affairs and Communications said in a preliminary report the country’s seasonally adjusted unemployment rate remained unchanged from the previous month at 4.9% in February.

The number of people with jobs dropped 800,000 to 61.85 million, declining for the 25 consecutive months.

The manufacturing sector shed 540,000 jobs to 10.49 million from the comparable year ago period.

In January jobs fell by 750,000 in the manufacturing industry. According to the report, 1.10 million people lost their jobs involuntarily.

BHP, Vale Agree Short-Term Contracts

BHP and Vale have managed to agree on short-term iron ore supply contracts with most Asian steel makers as the miners successfully moved from the previous annual contracts.

Nippon Steel and Sumitomo Metal Mining are understood to be still negotiating with BHP.

Nikkei Movers

Obayashi Corporation led the decliners in the Nikkei 225 Stock Average with a loss of 2.1% followed by losses in Mizuho Financial Group, Inc of 1.5%, in Shionogi & Co., Ltd of 1.5%, in Daiichi Sankyo Co Ltd 1.4% and in Ebara Corporation 1.4%.

Nippon Light Metal Company, Ltd led gainers in the Nikkei 225 Stock Average with a rise of 5.3% followed by gains in Nippon Soda Co., Ltd 5.0%, in Shinsei Bank, Limited of 4.5% and in Denki Kagaku Kogyo Kabushiki Kaisha 4.1%.

Other Movers

Canon Inc added 2.4% to 4,325.00 yen after the camera maker announced the resolution of a patent infringement lawsuit against Canada-based Densigraphix, concerning certain Densigraphix toner bottle products sold for use in Canon copier and multifunction products.

Japan Petroleum Exploration Co., Ltd the oil driller rose 1.7% to 4,720.00 yen.

Konica Minolta Holdings Inc climbed 3.4% to 1,096.00 yen after the film maker was upgraded to “outperform” from “market perform” at Mitsubishi UFJ Financial Group Inc.

Kobe Steel, Ltd rose 2.5% to 201.00 yen after the steelmaker announced that it has reaffirmed its consolidated full-year guidance for revenue of 1.67 trillion yen.

Mitsubishi Corporation the commodities trader advanced 3.8% to 2,462.00 yen.

NEC Corporation rose 2.9% to 282.00 yen after the electronics maker will invest more than 50 billion yen ($542 million) to expand production of parts used in lithium- ion batteries supplied to Nissan Motor Co.

Nippon Light Metal Company, Ltd which produces aluminum gained 5.3% to 138.00 yen.

Sony Corporation an electronics maker increased 1.9% to 3,610.00 yen.