Japanese stocks advance for third day, led by shipping lines
Japanese stocks rose for a third day, led by shipping lines after a gauge of transport fees climbed and Merrill Lynch & Co. raised its investment ratings.
Nippon Yusen K.K., the nation’s largest shipping company, and smaller rivals Mitsui O.S.K. Lines Ltd. and Kawasaki Kisen Kaisha Ltd. all climbed more than 5.5 percent. Chiyoda Co., a retailer of shoes, toys and clothes, sank 3.5 percent after cutting an earnings forecast. Izumi Co., which operates shopping centers, dropped 2.7 percent after the “challenging” environment prompted the company to slash a profit target.
The Nikkei 225 Stock Average rose 0.3 percent to 9,832.47 at the close in Tokyo. About eight stocks retreated for seven that advanced on the broader Topix index, which added 0.2 percent to 887.59.
“Once demand starts to grow faster, especially in emerging markets, earnings at shipping lines will recover fairly quickly,” said Naoki Fujiwara, chief fund manager at Shinkin Asset Management Co. in Tokyo, which oversees the equivalent of $4 billion. “Retailers’ earnings are deteriorating, dragged down by low consumer spending.”
Nippon Yusen added 7.3 percent and Mitsui O.S.K. climbed 5.8 percent. Kawasaki Kisen Kaisha Ltd., No. 3, jumped 7.4 percent. The stocks were the biggest winners in the Nikkei, and shipping lines as a group had the sharpest gain among the Topix’s 33 industries.
The Baltic Dry Index, a gauge of shipping fees for commodities, increased 4.3 percent yesterday in London, the most since July 16. Separately, Bank of America Corp’s Merrill Lynch unit boosted the three companies to “neutral” from “underperform.”
Stronger Yen
Gains were held back by the dollar’s depreciation against the yen, which reduces the value of overseas sales at Japanese companies when converted into their home currency. The U.S. currency weakened to as much as 88.01 yen late yesterday, a level not seen since Jan. 23.
“The strong yen is keeping investors nervous,” said Kenichi Hirano, general manager at Tachibana Securities Co.
Chiyoda fell 3.5 percent to 1,140 yen, its lowest close since September 2003. The company chopped its full-year forecast of operating profit by 33 percent yesterday after markets closed, citing slumping demand from shoppers.
Izumi decreased 2.7 percent, extending its drop to a sixth session. The company reduced its annual net income target by 24 percent, saying the business climate will remain “challenging” because of weakening consumer spending.
Japan’s household spending rose in August from July and June, a report from the statistics bureau showed last week. It was still lower than the level two years ago. The joblessness rate stayed at 5.5 percent, close to a record 5.7 percent reached in July.
Nippon Yusen K.K., the nation’s largest shipping company, and smaller rivals Mitsui O.S.K. Lines Ltd. and Kawasaki Kisen Kaisha Ltd. all climbed more than 5.5 percent. Chiyoda Co., a retailer of shoes, toys and clothes, sank 3.5 percent after cutting an earnings forecast. Izumi Co., which operates shopping centers, dropped 2.7 percent after the “challenging” environment prompted the company to slash a profit target.
The Nikkei 225 Stock Average rose 0.3 percent to 9,832.47 at the close in Tokyo. About eight stocks retreated for seven that advanced on the broader Topix index, which added 0.2 percent to 887.59.
“Once demand starts to grow faster, especially in emerging markets, earnings at shipping lines will recover fairly quickly,” said Naoki Fujiwara, chief fund manager at Shinkin Asset Management Co. in Tokyo, which oversees the equivalent of $4 billion. “Retailers’ earnings are deteriorating, dragged down by low consumer spending.”
Nippon Yusen added 7.3 percent and Mitsui O.S.K. climbed 5.8 percent. Kawasaki Kisen Kaisha Ltd., No. 3, jumped 7.4 percent. The stocks were the biggest winners in the Nikkei, and shipping lines as a group had the sharpest gain among the Topix’s 33 industries.
The Baltic Dry Index, a gauge of shipping fees for commodities, increased 4.3 percent yesterday in London, the most since July 16. Separately, Bank of America Corp’s Merrill Lynch unit boosted the three companies to “neutral” from “underperform.”
Stronger Yen
Gains were held back by the dollar’s depreciation against the yen, which reduces the value of overseas sales at Japanese companies when converted into their home currency. The U.S. currency weakened to as much as 88.01 yen late yesterday, a level not seen since Jan. 23.
“The strong yen is keeping investors nervous,” said Kenichi Hirano, general manager at Tachibana Securities Co.
Chiyoda fell 3.5 percent to 1,140 yen, its lowest close since September 2003. The company chopped its full-year forecast of operating profit by 33 percent yesterday after markets closed, citing slumping demand from shoppers.
Izumi decreased 2.7 percent, extending its drop to a sixth session. The company reduced its annual net income target by 24 percent, saying the business climate will remain “challenging” because of weakening consumer spending.
Japan’s household spending rose in August from July and June, a report from the statistics bureau showed last week. It was still lower than the level two years ago. The joblessness rate stayed at 5.5 percent, close to a record 5.7 percent reached in July.