Japanese Stocks Advance for Second Day as U.S. Earnings Rise; JFE Gains

Japanese stocks advanced for a second day after U.S. companies including Apple Inc. (AAPL) reported increased profits and oil prices surged, signaling the global economic recovery is accelerating.

Sony Corp. (6758), Japan’s biggest electronics exporter, gained 2 percent. Renesas Electronics Corp. (6723) and other makers of semiconductors and related tools advanced after Qualcomm Inc. (QCOM), the biggest maker of mobile-phone chips, reported profit that topped estimates. Inpex Corp. (1605), the country’s No. 1 oil explorer, rose 3.5 percent. JFE Holdings Inc. (5411), Japan’s second-largest steelmaker, climbed 3.5 percent after saying profit increased.

“The U.S. economic recovery, while still soft, is steadily recovering,” said Junichi Misawa, head of equity investment at Tokyo-based STB Asset Management Co., which oversees about $17 billion. “That affects the global economy. Also, rising commodity prices reflect strong demand.”

The Nikkei 225 (NKY) Stock Average rose 0.8 percent to 9,685.77 as of the close in Tokyo. The broader Topix gained 0.5 percent to 841.72, with eight shares rising for every seven that fell. The index has declined 9.6 percent since a magnitude-9 earthquake and tsunami on March 11 devastated Japan’s northeast coast, crippled a nuclear power plant and disrupted supply chains at companies from Renesas to Toyota Motor Corp.

Photographer: Haruyoshi Yamaguchi/Bloomberg

Pedestrians walk past the Tokyo Stock Exchange logo in Tokyo. Close

Pedestrians walk past the Tokyo Stock Exchange logo in Tokyo.

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Photographer: Haruyoshi Yamaguchi/Bloomberg

Pedestrians walk past the Tokyo Stock Exchange logo in Tokyo.

Tech Shares

Technology shares advanced after Apple reported profit that almost doubled. Sony gained 2 percent to 2,508 yen. TDK Corp. (6762), a supplier of sensors, soared 4.1 percent to 4,050 yen.

Chip-related companies advanced after Qualcomm’s earnings beat estimates and an index of U.S. semiconductor shares jumped. Renesas increased 2.5 percent to 708 yen. Elpida Memory Inc. (6665), Japan’s sole manufacturer of PC memory, jumped 3.6 percent to 1,179 yen. Sumco Corp. (3436), a maker of silicon wafers, gained 2.5 percent to 1,603 yen.

“U.S. companies, especially tech stocks, are doing well, and that’s helping to instill confidence,” said Mitsushige Akino, who oversees about $600 million in assets in Tokyo at Ichiyoshi Investment Management Co. “Investors are looking to take a little bit more risk.”

The Philadelphia Semiconductor Index climbed 4.3 percent yesterday after Intel Corp., the world’s biggest chipmaker, said sales this quarter may beat analyst estimates. The SOX index rose the most in almost 10 months.

Drillers, Traders

Higher oil and commodity prices boosted energy explorers and trading houses. Inpex advanced 3.5 percent to 622,000 yen. Japan Petroleum Exploration Co. (1662), the country’s second-largest oil driller, also gained after crude for June delivery rose the most in more than a month yesterday.

Mitsubishi Corp. (8058), Japan’s No. 1 commodities trader, gained 1.7 percent after the London Metal Exchange Index of six metals jumped 2.1 percent. Trading house Mitsui & Co. advanced 1.9 percent to 1,425 yen.

Nissan Motor Co., Japan’s second-largest carmaker, rose 3.2 percent to 746 yen after it said this month it will start to boost shipments of Leaf battery-electric cars to the U.S., where it has made about 500 deliveries since late December.

JFE Holdings jumped 3.5 percent to 2,249 yen after posting operating profit that more than doubled from a year earlier. Operating profit rose to 182.8 billion yen ($2.23 billion) in the 12 months through March, beating the company’s forecast of 180 billion yen.

Tokyo Electric Power Co., owner of the crippled Fukushima Dai-Ichi nuclear plant, dropped the most on the Nikkei, losing 4.9 percent to 423 yen. The Japanese government today said it will impose a 20-kilometer (12 mile) no-entry zone around the Fukushima plant, which is leaking radiation.

“The impact from Japan’s earthquake is weighing on the economy in a lot of ways, STB Asset’s Misawa said. “No one knows how bad power shortages will be or when they will end. That means there’s a limit to how high Japanese stocks can go.”

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

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net.

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