Senate Passes Bipartisan Budget Deal Rolling Back $63 Billion in Cuts
Stocks Rise for Third Day on U.S. Housing; Fast Retailing Slumps on Sales
Japanese stocks rose, sending the Nikkei 225 Stock Average to a fifth straight weekly gain, as U.S. housing and retail data bolstered confidence in a global economic recovery.
Canon Inc., which is the world’s biggest camera maker and gets more than 80 percent of its sales abroad, climbed 1.5 percent. Nikon Corp., a camera maker that counts North America as its largest market, gained 1 percent. Mitsui & Co., which counts commodities as its largest source of profit, rose 0.5 percent after metal prices increased. Fast Retailing Co., Asia’s biggest clothing chain, retreated 3 percent after sales at its flagship Uniqlo unit fell for a fourth consecutive month.
“Risks that the economy will deteriorate are decreasing and market sentiment is improving,” said Kenji Sekiguchi, who helps with strategy and investment in Tokyo at Mitsubishi UFJ Asset Management Co., which oversees $75 billion. “The U.S. economy is starting to come out of a period of marking time, during which the momentum of the economic recovery slowed.”
The Nikkei 225 rose 0.1 percent to 10,178.32 at 3 p.m. in Tokyo, the highest close since June 21. The broader Topix index advanced 0.2 percent to 879.22, as about five stocks gained for every three that fell. This week, the gauges climbed 1.4 percent.
The Nikkei had a fifth straight weekly advance, the longest winning streak since April. It has risen in December in six of the past seven years. Last month it gained 8 percent, the fastest pace among indexes for the world’s 45 largest equity markets and its first November increase since 2005.
Stocks have advanced as the dollar strengthened from a 15- year low against the yen, buoyed by the U.S. Federal Reserve’s expansion of record measures to support the world’s biggest economy. A stronger dollar swells the value of U.S. income at Japanese companies when converted into their home currency.
Canon increased 1.5 percent to 4,110 yen and was the biggest contributor to both the Nikkei and the Topix. Fanuc Corp., Japan’s No. 1 maker of industrial robots by revenue, rose 1.3 percent to 12,550 yen, its highest close since November 2007. Nikon gained 1 percent to 1,698 yen.
The Standard & Poor’s 500 Index climbed 1.3 percent yesterday in New York, led by financial shares after Goldman Sachs Group Inc. raised its rating on the industry.
Pending sales of U.S. existing houses jumped by a record 10 percent in October, the National Association of Realtors said yesterday. That compares with a median estimate by 40 economists surveyed by Bloomberg for a 1 percent drop. Separate reports showed claims for jobless benefits over the past month on average dropped to a two-year low, and that November chain-store sales exceeded estimates.
“The increase in pending home sales was a positive surprise,” said Juichi Wako, a senior strategist at Tokyo-based Nomura Holdings Inc.
Mitsui & Co., which counts commodities as its largest source of profit, gained 0.5 percent to 1,341 yen. Marubeni Corp. rose 2.2 percent to 569 yen, its highest close since April 26. JX Holdings Inc., Japan’s largest copper producer, increased 1.1 percent to 540 yen.
Crude oil for January delivery jumped 1.4 percent in New York yesterday to $88 a barrel, the highest settlement since Oct. 8, 2008. The London Metal Exchange Index of prices for six industrial metals including copper and aluminum rose 1.6 percent yesterday, a third consecutive advance.
The Nikkei 225 has fallen 3.5 percent this year and is down 10 percent from its 2010 high in April as Europe’s government- debt crisis and China’s steps to curb property-price inflation hurt confidence in a global economic recovery.
Fast Retailing Falls
Concern that tensions may escalate between North Korea and South Korea weighed on equities last week. Stocks in the Nikkei trade at 17.8 times estimated earnings on average, near their highest level since July.
Among today’s declines, Fast Retailing had the biggest percentage drop in the Nikkei 225 and was the gauge’s heaviest drag. The clothing-chain operator slumped 3 percent to 12,990 yen after saying sales at its Uniqlo stores in Japan fell for a fourth straight month, even after offering discounts on thermal wear and down jackets. Domestic sales at stores open at least a year declined 14.5 percent in November from a year earlier.
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