Japanese Stock Futures Rise as Yen Weakness Boosts Exporters

Japanese stock futures rose, indicating the Topix Index will extend its weekly advance, as the yen weakened to 100 per dollar for the first time in four years, boosting the earnings outlook for exporters.

American Depositary Receipts of Sony Corp. (6758) climbed 4.4 percent from the close in Tokyo as the maker of smartphones and televisions forecast a 16 percent increase in profit this fiscal year. ADRs of Nikon Corp. (7731), a camera maker that gets 85 percent of sales outside Japan, advanced 5.9 percent as its earnings forecast topped analyst estimates.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring next month traded at 14,545 in Chicago yesterday, up from 14,230 at the close in Osaka, Japan. They were bid in the pre-market at 14,530 in Osaka at 8:05 a.m. local time. The yen traded at 100.62 to the dollar at 8:08 a.m. in Tokyo. It last traded at 100 on April 14, 2009. Futures on Australia’s S&P/ASX 200 Index were little changed and New Zealand’s NZX 50 Index gained 0.1 percent.

“If you have a supportive export environment with the U.S. getting better, Europe has stopped getting worse, it actually augurs well for Japan for the medium term,” Simon Flood, chief investment officer at Lion Global Investors Ltd. in Singapore, where he helps oversee $25.5 billion, told Bloomberg TV. “There are a lot of great companies there, quality is high. If this Japanese story is more substance than form, you’re going to see a lot of international investors focusing their attention and looking for opportunities there.”

Hong Kong

Futures on Hong Kong’s Hang Seng Index slid 0.3 percent and contracts on the Hang Seng China Enterprises Index of mainland companies trading in Hong Kong retreated 0.5 percent. The Bloomberg China-US Equity Index of the most-traded Chinese shares in the U.S. dropped 0.2 percent in New York yesterday.

The MSCI Asia Pacific Index, the benchmark regional equities gauge, increased 10 percent this year through yesterday amid speculation the Bank of Japan will deploy more measures to beat deflation as policy makers in the U.S. and Europe remain on standby to buoy growth.

That left the gauge trading at 14.2 times average estimated earnings yesterday compared with 14.7 for the Standard & Poor’s 500 Index (SPX) and 13.2 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Of the 323 companies that reported earnings since the beginning of April and for which estimates are available, 51 percent exceeded expectations, while 48 percent missed forecasts, according to data compiled by Bloomberg.

Japan’s currency has dropped 4.2 percent since April 4 when BOJ Governor Haruhiko Kuroda outstripped economist forecasts by pledging to double monthly bond purchases and scoop up longer-term debt to reach a 2 percent annual inflation goal.

Futures on the Standard & Poor’s 500 Index rose 0.1 percent. The measure fell 0.4 percent yesterday, following five consecutive days of record closes, as Federal Reserve Bank of Philadelphia President Charles Plosser said he favors scaling back the central bank’s pace of stimulus.

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net

To contact the editor responsible for this story: John McCluskey at j.mccluskey@bloomberg.net

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