Japan Wages Fall 0.6%; Home Starts Drop 9.3%

Darlington Musarurwa
31 Mar, 2010
New York City

Stocks declined after February wages fell 0.6%. Wages fell primarily on fewer overtime hours and reduced manufacturing employment. Housing starts drop 9.3% to 56,527 units in February. In trading shipping companies closed higher on the expectations of rising freight rates.

[R]5:00 AM New York, 7:00 PM Tokyo – Stocks declined after February wages fell 0.6%. Wages fell primarily on fewer overtime hours and reduced manufacturing employment. Housing starts drop 9.3% to 56,527 units in February. In trading shipping companies closed higher on the expectations of rising freight rates.[/R]

Investors in Tokyo focused on the latest wage reports in Japan and private new home starts. Wages in February declined 0.6% and new homes buildings dropped more than 9.3%.

In Tokyo trading Nikkei 225 Stock Average decreased 0.1% or 7.2 to 11,089.94, and the broader Topix Index declined 0.1% to 978.81.

In the first section of the Tokyo Stock Exchange 9 billion shares worth 638 billion yen were traded and in the second section 247 million shares valued at 3.3 billion yen changed hands.

Of the Nikkei 225 stocks, 90 rose, 113 fell, and 20 were unchanged. Mitsui OSK Lines led gainers in the index shares with a rise of 3.6% on the improved outlook for exports to Asia and the U.S.

Other shipping lines advanced. Nippon Yusen soared 2.2% to 369 yen and Kawasaki Kisen jumped 1.9% to 373 yen.

Wages Fall 0.6% in February

Japan’s Ministry of Health, Labor and Welfare reported in its provisional report of monthly labor survey that total cash earnings fell 0.6% to 264,456 yen in February.

Contractual cash earnings decreased 0.3% to 262,088 yen, while scheduled cash earnings declined 0.9% to 244,247 yen and non-scheduled cash earnings rose 8.7% to 17,841 yen.

The report also notes that special cash earnings plunged 25.6% to 2,368 yen.

Total hours worked rose 1% to 143.7 hours as scheduled hours edged 0.3% to 133.9 hours and non-scheduled hours worked advanced 11.4% to 9.8 hours.

Days worked jumped 0.1% to 18.7 days.

Housing Starts Fall 9.3% in February

Japan’s Land Ministry reported today that the country’s housing starts dropped 9.3% to 56,527 units in February, falling for the fifteen month in a row.

Starts for detached houses occupied by owners rose 2.9% to 20,867 units, while those for rental homes decreased 8.4% to 21,671 units.

In addition, housing starts for condominiums for sale declined 25.6% to 13,069 units.

Separately, a real estate information company Home Co. said today the number of rental housing contracts signed in greater Tokyo fell 7.8% on the year in February.

The number of rental contracts signed in central Tokyo''s 23 wards contracted 13.4%, while the figure for suburban Tokyo declined 11.1%, Saitama 15.2% and Chiba 12.3%.

Kanagawa was the only prefecture in the area to rise, advancing 4.6%.

The average rent for new rental condominiums in greater Tokyo fell 1.5% to 103,600 yen from a year ago, while that for used units declined 2% to 91,400 yen.

Also the average rent for new units for small apartment increased 3.2% to 75,200 yen, while that for used apartments fell 0.2% to 60,900 yen.

Nikkei Movers

Pioneer Corporation led the decliners in the Nikkei 225 Stock Average with a loss of 3.9% followed by losses in Tokai Carbon Co Ltd of 2.3%, in Sky Perfect JSAT Holdings Inc of 2.3%, in Asahi Kasei Corporation 1.9% and in Nomura Holdings, Inc 1.8%.

Mazda Motor Corporation led gainers in the Nikkei 225 Stock Average with a rise of 4.7% followed by gains in Mitsui O.S.K. Lines, Ltd 3.5%, in Taisei Corporation of 3.0% and in Credit Saison Co., Ltd 2.7%.

Other Movers

Aeon Mall Co., Ltd added 2.6% to 1,971.00 yen after the shopping mall operator was upgraded to “buy” from “neutral” at Merrill Lynch & Co.

Alps Electric Co rose 0.7% to 645.00 yen after the company announced that it has decided to restructure into power converter business and power control unit related business into a new company, effective May 17.

Iwai Securities Co., Ltd fell 4.3% to 588.00 yen after the broker fell 4.3% to 588.00 yen.

Japan Wind Development Co., Ltd surged 13.7% to 279,300.00 yen after the wind-power company announced that it has issued one billion yen series unsecured corporate bonds, each with a face value of 100 million yen on March 31.

Modec Inc the maker of natural-gas production equipment added 2.5% to 1,677.00 yen.

Nomura Holdings, Inc the brokerage fell 1.4% to 689.00 yen.

Toppan Printing Co advanced 1.5% to 844.00 yen.

Yakult Honsha Co decreased 3.6% to 2,522.00 yen after the soft-drink maker was downgraded to “underweight” from “neutral” by JPMorgan Chase & Co.