Japan Stocks Gain as Yen Eases; Automakers Rise on Part Supplies

Japan’s stocks rose for a third day, erasing earlier losses, as exporters climbed after the yen fell from a three-week high. Carmakers gained after a key supplier said it will restart a plant damaged in last month’s earthquake.

Toyota Motor Corp. (7203), Honda Motor Co. and Nissan Motor Co., Japan’s top three carmakers, gained at least 2.1 percent. Renesas Electronics Corp. (6723), a chipmaker that has 30 percent of the world market for microcontrollers used in cars, surged as much as 6.2 percent after saying it will restart a damaged factory ahead of schedule. Yaskawa Electric Corp. (6506) jumped 7.3 percent after Credit Suisse Group AG boosted its investment rating on the motor maker.

“Renesas’ production restart is good news for the market,” said Tsutomu Yamada, a market analyst at Kabu.com Securities Co. in Tokyo. “It’s good for semiconductors and also for carmakers. Investors are looking forward to the supply chain getting back to normal.”

The Nikkei 225 (NKY) Stock Average gained 0.3 percent to 9,709.52 as of 2:16 p.m. in Tokyo, heading for its fourth weekly gain in five as Japan’s stock market rebounds from losses in the wake of last month’s disaster. The broader Topix advanced 0.2 percent to 843.59. Stock markets in Australia, New Zealand, Hong Kong and Singapore are closed today for a holiday.

Renesas’ Factory

The Topix declined 9.6 percent through yesterday after a magnitude-9 earthquake and tsunami on March 11 devastated Japan’s northeast coast, disabled a nuclear power plant, and disrupted supply chains at companies from Toyota to Renesas. In the same period the Standard & Poor’s 500 Index rose 3.3 percent, while the Stoxx Europe 600 Index dropped 0.9 percent.

Renesas gained 1.3 percent to 717 yen after saying it plans to restart operations at a quake-halted plant in northern Japan. Shares reversed earlier losses and rose as much as 6.2 percent after the announcement.

Carmakers had the biggest advance among the Topix’s 33 industry groups, rebounding after declines during the morning trading session. Toyota gained 3 percent to 3,290 yen. Honda rose 2.1 percent to 3,140 yen, while Nissan increased 3.5 percent to 772 yen.

Retailers dropped after Prime Minister Naoto Kan proposed a 4-trillion yen ($49 billion) reconstruction budget that may entail a higher consumption tax. Economic and Fiscal Policy Minister Kaoru Yosano said this week that reconstruction “must” be backed by higher levies.

Retailers Slump

Seven & I Holdings Co., owner of the 7-Eleven convenience- store brand, slid 1.1 percent to 2,016 yen, while Yamada Denki Co., an electronics retailer, slumped 1.7 percent to 5,330 yen.

Exporters also gained after the yen weakened. Japan’s currency depreciated to 81.88 as of 2:14 p.m. in Tokyo, weakening from 81.67 earlier. Against the euro, the currency fell to 119.33 from 118.83, boosting the value of overseas income at Japanese companies when repatriated.

Yaskawa Electric jumped 7.3 percent to 926 yen, the most in the Nikkei 225, after Credit Suisse Group AG boosted the company’s investment rating to “outperform” from “neutral.” Yaskawa secured alternative part supplies faster than expected after the earthquakes, Credit Suisse analyst Shinji Kuroda said today.

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

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