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Japan Stock Futures Fall on U.S. Manufacturing, Rising Yen

Japanese stock futures fell after data on U.S. manufacturing missed estimates and the yen rose to a four-week high versus the dollar, damping earnings prospects for exporters.

American depositary receipts of Sony Corp. (6758), an electronics maker that gets 19 percent of its sales in the U.S., fell 1.5 percent from the closing share price in Tokyo. ADRs of Nissan Motor Co. (7201), Japan’s third-largest carmaker by market value, slid 1.2 percent as Japanese vehicle sales fell by the most in six quarters after government subsidies ended. BHP Billiton Ltd., Australia’s biggest oil producer, lost 0.2 percent in Sydney after crude prices fell.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring in June closed at 12,060 in Chicago yesterday, down from 12,180 in Osaka, Japan. They were bid in the pre-market at 12,060 in Osaka at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index rose 0.6 percent today. New Zealand’s NZX 50 Index dropped 0.4 percent in Wellington. Markets in Australia, New Zealand and Hong Kong reopen today after a four-day weekend.

“The bar has been set quite high now after such a long stretch of economic data outperforming expectations, and we are likely to go through a period when economic data will miss expectations,” said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which manages $126 billion. “Markets are quite vulnerable to a corrective stage.”

U.S. Manufacturing

Futures on the Standard & Poor’s 500 Index (SPXL1) were little changed today. The index fell 0.5 percent in New York yesterday, retreating from a record high, as the Institute for Supply Management’s factory index fell to 51.3 in March from 54.2 February, the Tempe, Arizona-based group said. The median forecast of economists surveyed by Bloomberg was for 54. A reading of 50 is the dividing line between growth and contraction.

In Asia, the Bank of Japan’s Tankan index yesterday showed pessimism among large manufacturers, while data on South Korean exports and China factory output trailed forecasts.

The yen reached 93.06 per dollar today, the highest level since March 6, after rising against all of its 16 major counterparts yesterday. A stronger yen cuts the value of overseas earnings at Japanese exporters when repatriated.

West Texas Intermediate oil for May delivery dropped 16 cents to settle at $97.07 a barrel on the New York Mercantile Exchange.

The MSCI Asia Pacific Index (MXAP) gained 3.7 percent this year through yesterday, led by Japanese shares on speculation the nation will deploy more stimulus. The Asia benchmark traded at 14.8 times estimated earnings on average, compared with 14.1 times for the Standard & Poor’s 500 Index and 12.6 times for the Stoxx Europe 600 Index. The Bank of Japan meets April 3-4 in its first policy meeting after new Governor Haruhiko Kuroda took office.

The Bloomberg China-US Equity Index of the most-traded Chinese companies in the U.S. declined 1 percent to a two-week low of 91.29 yesterday in New York.

To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

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

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