Mitsui OSK Lines Ltd, operator of Japan's largest fleet of iron-ore ships and Kawasaki Kisen Kaisha Ltd rose the most in more than two weeks in Tokyo trading as commodity prices gained, which may boost shipping demand. Mitsui OSK rose as much as 11 per cent to 497 yen (S$7.37) and traded at 485 yen as of the 11 am morning close in Tokyo trading. Kawasaki Kisen, Japan's third-largest shipping line, gained as much as 13 per cent to 398 yen.
Crude oil for December delivery climbed 7.6 per cent to US$67.50 a barrel in New York yesterday, the steepest jump in a month. Mitsui OSK earlier this week reported a 30 per cent increase in second-quarter net income and Kawasaki Kisen's profit rose 62 per cent in the quarter.
'The shares are cheap compared with their earnings,' said Osuke Itazaki, an analyst in Tokyo at Credit Suisse Group. 'Investors have already factored in more than the worst case scenario for their profits.'
Mr Itazaki recommends investors buy Mitsui OSK shares, which have fallen 66 per cent this year, and Kawasaki Kisen stock, which is down 64 per cent this year.
Crude oil for December delivery climbed 7.6 per cent to US$67.50 a barrel in New York yesterday, the steepest jump in a month. Mitsui OSK earlier this week reported a 30 per cent increase in second-quarter net income and Kawasaki Kisen's profit rose 62 per cent in the quarter.
'The shares are cheap compared with their earnings,' said Osuke Itazaki, an analyst in Tokyo at Credit Suisse Group. 'Investors have already factored in more than the worst case scenario for their profits.'
Mr Itazaki recommends investors buy Mitsui OSK shares, which have fallen 66 per cent this year, and Kawasaki Kisen stock, which is down 64 per cent this year.