Japanese Stocks Rise to One-Month High on Currency; Consumer Lenders Jump

Japanese stocks rose, driving benchmark indexes to their highest levels in more than a month, as the outlook for export earnings improved after the yen weakened from yesterday’s close.

Honda Motor Co., a carmaker that gets more than 80 percent of its sales abroad, gained 1.9 percent. Sony Corp., a maker of electronics that earns more than 40 percent of its revenue from the U.S. and Europe, rose 1.4 percent. Hitachi Ltd. advanced 3.6 percent after Deutsche Bank AG boosted its rating on the company to “buy.” Takefuji Corp. led consumer lenders higher after Citigroup Inc. said some refund claims dropped.

“The currency has so much impact on the Japanese economy that the weaker yen can boost Japanese stocks, even though markets globally aren’t rising,” said Masayuki Kubota, who helps manage about $1.7 billion in Japanese equities at Tokyo- based Daiwa SB Investments Ltd.

The Nikkei 225 Stock Average rose 1.2 percent to 9,626.09 in Tokyo, the highest close since Aug. 6. The broader Topix climbed 0.9 percent to 852.09, with almost four times as many shares advancing as declining.

This week, the Nikkei gained 4.2 percent, its biggest increase since December, and the Topix climbed 2.2 percent, their third consecutive weekly advance.

The Topix fell 8 percent this year to Sept. 14, the second- biggest drop among benchmark indexes for the world’s 15 largest stock markets. That was the day before Japan’s government said it acted in the market to weaken the yen for the first time since 2004, leading the currency to plunge and stocks to surge.

Further Intervention?

“People in the market want to figure out if the government and the Bank of Japan will intervene to weaken the yen further,” said Juichi Wako, a senior strategist at Tokyo-based Nomura Holdings Inc.

Honda, Japan’s second-biggest carmaker, gained 1.9 percent to 3,015 yen, contributing the most to the Topix’s advance. Toyota Motor Corp., the world’s largest automaker, rose 0.8 percent to 3,085 yen, the highest close in a month.

Sony, the maker of Cyber-shot cameras and Vaio computers, rose 1.4 percent to 2,678 yen. Fanuc Ltd., a maker of industrial robots that gets about 80 percent of revenue overseas, increased 0.5 percent to 10,270 yen. Electronics makers were the biggest boost to the Topix among its 33 industry groups.

The yen depreciated to as low as 112.71 against the euro today in Tokyo from 110.85 at the close of stock trading yesterday. Against the dollar, Japan’s currency weakened to 85.91 from 85.36. A weaker yen boosts overseas income at Japanese companies when converted into their home currency.

Hitachi, GS Yuasa

“The biggest point of interest for investors who trade Japanese stocks is the yen,” Nomura’s Wako said.

Hitachi, a maker of products ranging from washing machines to nuclear reactors, leapt 3.6 percent to 378 yen after Deutsche Bank raised its rating to “buy” from “hold.”

GS Yuasa Corp. climbed 3.3 percent to 619 yen, the highest close since June 24. The Nikkei newspaper said the battery maker, Mitsubishi Corp. and Magna International Inc., Canada’s largest auto-parts maker, may start joint European production of lithium-ion batteries for electric vehicles.

Mitsubishi, which gets about half its sales from commodities, rose 1.6 percent to 1,955 yen and rival Sumitomo Corp. advanced 2.3 percent to 1,094 yen.

The London Metal Exchange Index of six metals including aluminum and copper gained 0.8 percent yesterday to the highest level since April 26. Copper futures rose to a one-week high in New York yesterday as the dollar’s decline boosted the appeal of metals as an alternative investment. Tin climbed to the highest price since 2008.

Takefuji soared 7.5 percent to 173 yen and larger consumer lenders Promise Co. and Acom Co. both jumped at least 6 percent after Citigroup said in a report dated yesterday that claims for interest repayments at the three companies fell in August. Credit Saison Co., a credit-card company, surged 7.6 percent, the largest gain in the Nikkei 225. Consumer lenders had the biggest percentage gain among the Topix’s industry groups.

To contact the reporter for this story: Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net.

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