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Japan’s Nikkei almost flat, paring earlier gains

Japan’s Nikkei almost flat, paring earlier gains
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First Published: Wed, Oct 10 2007. 02 36 PM IST
Updated: Wed, Oct 10 2007. 02 36 PM IST
Agencies
Closing
Tokyo: Japan’s Nikkei stock average ended almost flat on Wednesday, 10 October erasing earlier gains as investors sold Toyota Motor Corp and Olympus Corp, offsetting a rise in retail shares.
Olympus lost 2.8%, becoming one of the biggest drags on the market, after JP Morgan cut its rating on the maker of digital cameras and medical equipment to “neutral” from “overweight.”
The benchmark Nikkei closed up 0.1% or 17.99 points at 17,177.89. The broader Topix index was down 0.1% at 1,658.18, after rising 0.7% soon after the open.
Trade was light with 1.7 billion shares changing hands compared with a daily average of 1.9 billion shares in September.
Declining shares outnumbered advancers by 863 to 706.
Olympus Corp fell 2.6% to 4,960 yen after hitting an all-time high of 5,320 yen in the previous session.
Toyota Motor was also a major drag on the indexes, down 1.3% at 6,670 yen, extending losses after the firm cut its domestic sales target for 2007 on Tuesday.
After the close, convenience store chain Lawson Inc said it would buy back up to 21 billion yen ($179 million) or 5.07 percent of its own shares.
Japan’s second-largest retail group Aeon Co Ltd said it was teaming up with SIIC Shanghai, a property investment arm of Shanghai city, to develop shopping centres in China. Reuters
Morning
Tokyo: Japanese share prices rose 0.34% in morning trade on Wednesday after Wall Street set fresh highs overnight on renewed hopes of another US interest rate cut, dealers said.
They said the minutes from the Federal Reserve’s September meeting suggested the central bank may be open to more rate cuts after last month’s hefty half-point reduction aimed at calming volatile financial markets.
The Tokyo Stock Exchange’s benchmark Nikkei-225 index of leading shares gained 57.63 points to 17,217.53 by the lunch break.
The broader Topix index of all first-section shares added 5.41 points or 0.33% to 1,665.47.
Gainers beat decliners 1,008 to 573, with 126 issues unchanged.
Turnover dropped to 783.5 million shares from 843 million Tuesday morning.
The gains came after US share prices leapt to fresh record highs Tuesday after the release of the Fed minutes.
“The external environment has improved, which has pushed the Nikkei index back over 17,000 points,” said Mitsushige Akino, chief fund manager at Ichiyoshi Management.
“But investors were cautious as they are mulling whether Wall Street will be able to sustain its strong momentum. So selling on the rally prevented share prices from rising further,” said Akino.
He said investors in Tokyo were cautious about prospects for another US rate cut in the wake of Friday’s strong US jobs report.
Investors were awaiting earnings results from retailers FamilyMart and Lawson for their financial first half to August.
The Bank of Japan was also due to begin a two-day policy board meeting but is widely expected to leave its key interest rate unchanged at 0.5 percent.
Oil-related shares were higher on the back of a rise in US crude oil futures.
Inpex Corp. rose 50,000 yen or 4.3% to 1.22 million yen and Japan Petroleum Exploration Co, or Japex, climbed 170 yen or 2.1% to 8,410.
Nippon Oil Corp rose 28 yen or 2.7% to 1,080.
Japan Airlines Corp (JAL) and Japanese supermarket operator Aeon Co Ltd were higher after they announced a business alliance, starting with the creation of two new loyalty cards aimed at expanding market share.
JAL gained nine yen or 3.5% to 263 and Aeon increased 110 yen or 6.6% to 1,790.
Sony edged up 10 yen or 0.2% to 5,830 after it said it will cut the price of its PlayStation 3 game console in Japan to prop up sluggish sales before the Christmas season. AFP
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First Published: Wed, Oct 10 2007. 02 36 PM IST
More Topics: Stocks | Nikkei | Topix | Sony | Nippon Oil |