Tue, July 06, 2010
Business > Markets

Tokyo stocks mirror China's gains, weak yen lifts exporters

2010-07-06 11:43:48 GMT2010-07-06 19:43:48 (Beijing Time)  Xinhua English

Japanese stocks rose Tuesday with the key Nikkei stock average rebounding from a seven-month low the previous day as robust Chinese stocks and the yen's depreciation lifted investor sentiment, amid ongoing concerns about the health of the U.S. economy and euro zone members' lofty deficit countermeasures.

The 225-issue Nikkei Stock Average rose 71.26 points, or 0.77 percent, from Monday to finish at 9,338.04 after falling as low as 9,091.70, meanwhile the broader Topix index of all First Section issues on the Tokyo Stock Exchange rose 10.35 points, or 1.24 percent, to 847.24.

The Nikkei fell to a fresh intraday low in early trade as the yen's rise against the dollar and the euro impacted exporter shares, brokers said. However as the Japanese currency eased in the afternoon, incentives for investors grew and exporters were granted some relief.

Concerns about the pace of the global economic recovery, on the back of worrying macroeconomic data coming out of the U.S. -- including employment data that fell below market expectations -- were allayed by a strong performance of Chinese stocks with the Shanghai Composite Index gaining nearly 2 percent.

"A rise in Shanghai stocks and a pullback by the yen helped soothe market sentiment. Some investors also appeared to have bought back stocks with Japanese government bonds sagging today," said Kazuhiro Takahashi, general manager at Daiwa Securities Capital Markets.

"But a strong trend has struggled to emerge in Tokyo as trade has been thin as the United States was on holiday yesterday. The market will need stronger incentives to establish a clearer trend, " he added.

Semiconductor maker Tokyo Electron Ltd. edged up 0.4 percent to 4,750 yen, while Canon Inc. gained 2 percent to 3,350 yen.

Iriso Electronics Co. gained 5.2 percent to 1,447 yen, marking the firm's largest advance since November 30. The circuit-board equipment maker said it will repurchase as much as 1.7 percent of its outstanding shares.

Focus Systems Corp. surged 7.2 percent to 239 yen, following the computer-software developer saying it will buy back as much as 2.88 percent of its shares.

Honda Motor Co. advanced 2.2 percent to 2,566 yen after dropping as much as 1.6 percent earlier in the day.

NTT DoCoMo rose 1.7 percent to 139,300 yen after Japan's biggest mobile phone operator said it plans to allow users to switch carriers without changing their handsets.

China-linked issues thrived with Komatsu Ltd. adding nearly 2 percent to 1,646 yen and farm equipment manufacturer Kubota Corp. gaining almost 2 percent to 683 yen.

Consumer lenders saw Monday's sharp gains reversed as Japan's Financial Services Minister Shozaburo Jimi said he opposes a plan by Osaka prefecture to loosen regulations for consumer finance companies, arguing the same rules should be applied throughout the country.

Acom Co. slumped 4.2 percent to 1,383 yen and Aiful Corp. sank 8.9 percent to 123 yen. Meanwhile, Takefuji Corp. plunged 8.4 percent to 273 yen and Promise Co. retreated 4.4 percent to 655 yen.

Japanese retailers ended mixed with Fast Retailing Co. retreating for the second day, losing 3 percent to 12,800 yen, after the retailer said on July 2 its domestic sales at its Uniqlo casual-clothing chain fell 5.8 percent in June from a year earlier.

ABC-Mart Inc. declined 2.4 percent to 3,290 yen, following the shoe retailer announcing same-store sales in June dropped 1.5 percent from a year earlier, dragged down by per-customer sales which plunged by 6.9 percent.

However, Izutsuya Co. surged 8.5 percent to 64 yen, following the department store operator reporting its first-quarter net income of 451 million yen (5.13 million U.S. dollars), compared with a loss booked a year earlier.

On Tuesday some 1.86 billion shares changed hands on the Tokyo exchange's First section, up from Monday's volume of 1.43 billion, with advancing issues outnumbering declining ones by 1,132 to 400.

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