Japan Stocks Post First Two-Week Gain Since July

Japan stocks rose today on high trading volumes, posting their first back-to-back weekly gain since July. Yahoo Japan Corp. surged after Twitter Inc. filed paperwork for a share sale.

A gauge tracking paper producers gained 1 percent, the most among the 33 Topix index subsectors. Digital Garage Inc., an Internet company said to have a stake in Twitter, surged 17 percent after the San Francisco-based microblogging service filed to go public. Yahoo Japan, a partner of Twitter, rose the most on the Nikkei 225 Stock Average. Mitsui OSK Lines Ltd. (9104), operator of the world’s largest merchant shipping fleet, lost 3.5 percent.

The Topix rose 0.1 percent to 1,185.28 at the close in Tokyo, swinging between gains of 0.5 percent and losses of as much as 0.8 percent during the session. Volume was 66 percent above the 30-day average. The Nikkei 225 (NKY) added 0.1 percent to 14,404.67. The Fed meets Sept. 17-18, with economists predicting the U.S. central bank will taper its monthly bond buying by $10 billion to $75 billion, according to a Bloomberg survey.

“We don’t know how markets will react after the Fed meeting,” said Hiroaki Hiwada, a strategist at Toyo Securities Co. in Tokyo. “We have to wait and see on that, which means it’s hard for investors to be active right now. That said, the mood is becoming more positive, with Tokyo winning the Olympics, the upward revision of second-quarter GDP and the talk of stimulus to accompany the sales-tax rise.”

Weekly Advance

The Topix climbed 3.3 percent this week on optimism that Tokyo’s winning bid to host the 2020 Olympic Games, announced last weekend, would boost profits at real estate, construction and tourism companies.

Japanese output expanded an annualized 3.8 percent in the three months through June from the first quarter, higher than an initial estimate of 2.6 percent, reflecting stronger private capital investment, the Cabinet Office said in Tokyo on Sept. 9.

Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The gauge declined yesterday for the first time in eight days amid concern about a possible military strike on Syria and the prospect of the Fed cutting stimulus. The S&P 500’s 18 percent rally this year has been outpaced by a 38 percent surge for the Topix.

Japan’s Cabinet Office raised its monthly assessment of the nation’s economy today ahead of an expected Oct. 1 decision by Prime Minister Shinzo Abe on whether to increase the sales tax. Lawmakers are considering a reduction in corporate income taxes as part of a stimulus package to cushion the economy from the planned increase in the sales levy, according to three people briefed on the matter.

Growth Strategies

“We could see some buying on dips,” said Hideyuki Ishiguro, senior strategist at Okasan Securities Co. in Tokyo. “Expectations are rising about the country’s economic policies and growth strategies, which is reassuring investors.”

Digital Garage soared 17 percent to 690,000 yen. An initial public offering for Twitter is positive for the firm as it has a stake in the U.S. company, Iwai Cosmo Securities Co. analyst Tomoaki Kawasaki said by phone.

Yahoo Japan climbed 4 percent to 52,500 yen, its biggest advance in almost two months.

Shippers fell after the Baltic Dry Index (BDIY), a measure of freight prices, yesterday posted its first decline in nine days. Mitsui OSK slid 3.5 percent to 445 yen. Kawasaki Kisen Kaisha Ltd. declined 1.2 percent to 240 yen.

Sharp Corp. sank 4.4 percent to 347 yen, extending a two-day slide to 10 percent. The TV maker may announce a public share sale and third-party allotment as early as next week, the Yomiuri newspaper reported yesterday, without saying where it got the information.

To contact the reporters on this story: Adam Haigh in London at ahaigh1@bloomberg.net; Satoshi Kawano in Tokyo at skawano1@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.