WSJ:Tokyo Shares Snap 4-Day Skid On Stronger Dollar, Bargain-Buying
By Brad Frischkorn
TOKYO--Tokyo stocks put an end to a four-day losing streak Tuesday, as a more supportive dollar along with bargain-buying helped offset another mixed bag of earnings announcements.
The Nikkei Stock Average rose 208.69 points, or 1.5%, to 13,869.82 following the prior session's 3.3% decline, helping reclaim some the 1,100 points of losses sustained since last Wednesday.
The Topix index of all the Tokyo Stock Exchange First Section issues also gained 20.08 points, or 1.8%, to 1,148.53, with all 33 subindexes ending in positive territory.
The market rise was helped by a more resilient dollar, which finally began finding some traction after several days of steady weakness. The greenback trended mostly above the Y98 mark Monday.
As of the TSE close at 0600 GMT, it was seen at Y98.35 after starting the day at the upper Y97 level.
"Buyers are reacting to short-term oversold conditions while keeping an eye on earnings reports," said Tachibana Securities market advisor Kenichi Hirano. "Post-July 21 upper house elections position-adjusting has resulted in many players taking money off the table; they want to wait to see how external numbers such as U.S. GDP and jobs data turns out before re-committing."
Still, daily earnings results aren't translating into a sense of buying urgency, traders say.
"Just because selling has been heavy lately doesn't necessarily mean that a viable rally is in the wings," said kabu.com Securities chief strategist Tatsunori Kawai. "The lack of consistency in earnings reports is undermining fundamental confidence in the market."
Major earnings reporting shares included Komatsu, which notched a hard-fought gain of 1.3% at Y2,192 after spending much of the session in negative territory. The firm posted an April-June group operating-profit fall of 6% on year, pushing its Y52.4 billion total well under analysts' expectations.
Still the downward revisions that some had feared didn't materialize, noted a coverage analyst at a foreign brokerage. "In a difficult business environment, tight inventory control and sales price hikes meant first-quarter operating profits declined by less than at competitors, while operating profit margins exceeded those of its rivals."
Shares of Komatsu rival Hitachi Construction Machinery ended down 3.0% at Y1,973 after the company posted an on-year operating profit fall of 28% to Y9.6 billion.
On the plus side, Daiwa Securities Group rose 3.3% to Y839 after the company reported that its first quarter fiscal 2013 net profit surged to a record high Y57.3 billion on year, thanks to strong growth at its retail business. Daiwa's revenue in the period soared 61% to Y183.08 billion on year.
Sumitomo Mitsui Financial Group added just 0.9% to Y4,505, after its net profit more than doubled in the April-June quarter, thanks to a strong performance at its brokerage unit amid the recent stock rally.
Auto parts maker Calsonic Kansei surged 18% to Y516 after logging a first quarter operating profit of Y4.6 billion, well ahead of street estimates. The company also kept its full fiscal-year guidance--an operating profit of Y20 billion, drawing praise.
Shares of regional lender Fukuoka Financial Group also added 5.6% at Y437 after the firm reported that its first quarter consolidated net profit increased 48% on year to Y18.8 billion. The bank also revised up its consolidated net profit guidance to Y22 billion from Y12.6 billion for its first fiscal half, and to Y33 billion from Y27 billion for the full year.
