Japan’s Nikkei 225 Stock Average (NKY) closed above 15,000 for the first time since 2007 after the yen touched a 4 1/2-year low against the dollar. Sony Corp. (6758) jumped as shareholder Daniel Loeb pushed for its breakup.
Toyota Motor Corp. (7203) added 3.7 percent to pace gains among exporters. Sony soared 10 percent as Loeb’s Third Point hedge fund pressed the company to spin off part of its entertainment business. Mitsubishi UFJ Financial Group Inc. (8306), which posts results today, advanced 3.1 percent after the Nikkei newspaper said the lender will beat earnings estimates and raise its dividend. Isuzu Motors Ltd. (7202) surged 21 percent after forecasting better-than-expected operating profit.
The Nikkei 225 gained 2.3 percent to close at 15,096.03 in Tokyo, the highest since Dec. 28, 2007. Volume was about 54 percent above the 30-day average. The broader Topix Index advanced 1.8 percent to 1,252.85.
“Every time the yen falls below a key level, the Nikkei passes another milestone because it boosts corporate profits, especially for manufacturers,” said Masaru Hamasaki, a senior strategist at Tokyo-based Sumitomo Mitsui Asset Management Co., which oversees the equivalent of $100 billion. “Stocks should rise further as investors acknowledge the impact of government policy. Given that, I don’t think stocks are that expensive.”
The Topix has risen 46 percent this year, outperforming all major equity indexes amid unprecedented monetary easing from the Bank of Japan. The gauge yesterday traded at 1.4 times book value, compared with 2.4 for the Standard & Poor’s 500 Index and 1.7 for the Stoxx Europe 600 Index.
The yen touched 102.43 per dollar, the lowest since October 2008, before trading at 102.24. A weaker yen enhances overseas earnings at Japanese exporters.
Toyota advanced 3.7 percent to 6,440 yen and Canon Inc. (7751), the world’s biggest camera maker, gained 2.6 percent to 3,740 yen. Komatsu Ltd, a machinery maker that gets 30 percent of its revenue in the Americas, advanced 2.3 percent to 2,894 yen.
Sony jumped 10 percent to 2,072 yen, the highest since July 22, 2011, after Loeb, founder of Third Point LLC, recommended selling as much as 20 percent of Sony’s entertainment unit in an initial public offering that would free it from the struggling electronics business.
Sony Financial Holdings Inc. (8729), the company’s insurance unit, advanced 9.4 percent to 1,620 yen.
Of the 754 companies on the Topix that have reported full-year earnings since April 1, and for which Bloomberg has estimates, 452 beat analysts’ projections. Mitsubishi UFJ and Sumitomo Mitsui Financial Group Inc. are among more than 140 companies that post results today.
Mitsubishi UFJ gained 3.1 percent to 732 yen after the Nikkei reported the bank’s annual payout will rise by 1 yen to 13 yen per share for the year ended March and is likely to gain to 14 yen this fiscal year. Net income will be in the mid-800 billion yen range, topping the average analyst estimate of 745 billion yen.
Isuzu surged 21 percent to 872 yen after forecasting operating profit of 180 billion yen for the year ending March 2014, above the average analyst estimate of 153 billion yen.
Among other stocks that rallied, Meiji Holdings Co. (2268) advanced 8.3 percent to 4,825 yen after beating estimates for net income forecast. Net income will be 16.5 billion yen in the 12 months through March 14, above the average analyst estimate of 15.8 billion yen.
Futures on the S&P 500 slid 0.1 percent today. The gauge rose 1 percent yesterday in New York to a record high. Germany’s DAX Index advanced 0.7 percent to an all-time high of 8,339.11.
The Nikkei Stock Average Volatility Index rose 0.6 percent to 26.59, indicating traders expect a swing of about 7.6 percent on the benchmark gauge during the next 30 days.
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