Japan Exporters, Bank Stocks Prop Up Topix After Yen Weakens

(Bloomberg) -- Japanese electronics and auto makers’ shares buoyed the Topix index after the yen remained weaker and investors shifted their focus away from geopolitical risks such as North Korea.

The benchmark gauge is headed for its first weekly gain in six, after U.S. long-term yields advanced Wednesday, prompting gains in bank stocks, and exports grew at the fastest rate in more than two years in March. The 25-day Toraku index, which compares the numbers of advancing and declining stocks on the benchmark, stood at 71.7 on Wednesday, below 80, which some investors consider a signal shares are due for a rebound. The first round of voting for the French presidential election is scheduled for Sunday.

“As a sense of alarm toward geopolitical risk recedes, we’re getting fewer reasons for Japanese stocks to be sold,” said Juichi Wako, a senior strategist at Nomura Holdings Inc. “Investors are thinking that the North Korean issue won’t trigger immediate military action, and there’s increasingly fewer reasons to keep buying bonds, or keep selling the yen against the dollar.”

Japan’s exports expanded for a fourth consecutive month, rising 12 percent in March from a year earlier and beating estimates of a 6.2 percent increase.

Summary

• Topix +0.1% to 1,472.81 at the close in Tokyo
• Nikkei 225 little changed at 18,430.49
• Yen little changed at 108.89 per dollar after weakening 0.4% Wednesday
• Gauge of bank stocks +1.4%; Mitsubishi UFJ Financial +1.7%, Resona +1.5%, Shinsei +2.6%
• Automakers advance: Nissan Motor +1.2%, Toyota Motor +1%, Subaru +2.3%
• Energy producers -2.4%, after oil slumped most in six weeks as expanding U.S. crude production countered fall in stockpiles
• Advantest +4.5% after JPMorgan Securities rates new overweight
• Canon +2.7% after Nikkei reports co.’s 1Q operating profit almost doubled to 80b yen, helped by Toshiba Medical acquisition; Bloomberg est. 42.8b yen
• NOK Corp. +7.1% after announcing prelim. full-year operating profit 39.7b yen that beat co. forecast 30.3b yen
• Sumitomo Rubber Industries +2.4% after Morgan Stanley MUFG raises rating to overweight from equalweight

For more on Japan markets:
Contrarian Bears Bet Against Yen as Hedge Funds Pare Shorts (1)
Economists See BOJ on Hold in April, Tightening Likely Next Step
Pimco’s Kiesel Says Japan, U.K. Debt World’s Most Overvalued (1)
How Japan’s Bet on Asian Casino Boom May Play Out: QuickTake Q&A

To contact the reporters on this story: Yuko Takeo in Tokyo at ytakeo2@bloomberg.net, Nao Sano in Tokyo at nsano3@bloomberg.net.

To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Jonathan Annells, Naoto Hosoda