The Topix added 1.4 percent to 1,202.89 at the close in Tokyo, with all but one of its 33 industry groups gaining, to cap the longest rally since April. The gauge lost 0.7 percent this month, its third straight monthly decline, and 7.6 percent for the quarter, its first such drop since the three months ended September 2012. The yen held losses at 102.85 per dollar after sliding 0.6 percent on March 28. Reports last week showed household spending in the U.S. rose in February, while consumer confidence fell less than initially estimated in March.
“Both the weakening of the yen and the improvement of U.S. consumer sentiment will be positive for Japanese stocks today,” said Kenichi Hirano, a Tokyo-based market analyst at Tachibana Securities Co. “There’s a strong likelihood the market direction has changed.”
A measure of insurance companies gained 3.1 percent, the most among the Topix’s industry groups. Honda Motor Co., which gets about 80 percent of revenue abroad, climbed 2.3 percent. JFE Holdings Inc. rose 2.2 percent after a report Japanese steelmakers and miner Anglo American Plc agreed on cheaper coal prices. Precision-instrument makers were the only Topix group to decline. The Nikkei 225 Stock Average added 0.9 percent today to 14,827.83.
The Topix capped its biggest quarterly decline since the three months ended June 2012, the worst performance among developed markets tracked by Bloomberg, after surging 51 percent in 2013. An appreciating yen amid China’s slowdown and Russia’s annexation of Crimea, concern about a sales-tax increase, and slow progress on Prime Minister Shinzo Abe’s so-called third-arrow package of policies punished shares.
Japan increases its consumption tax by three percentage points to 8 percent tomorrow. The economy is projected to contract an annualized 3.5 percent in the three months starting April, according to the median forecast of 28 firms surveyed by Bloomberg.
Data today showed the nation’s industrial production fell 2.3 percent in February from the previous month. Economists surveyed by Bloomberg had expected a 0.3 percent advance.
Futures on the Standard & Poor’s 500 Index jumped 0.4 percent today. The measure gained 0.5 percent on March 28 as consumer shares rebounded. Data from the Commerce Department on March 28 showed U.S. consumer spending rose in February by the most in three months.
The Topix Insurance Index’s rally today pared its decline this quarter to 13 percent. Sony Financial Holdings Inc., NKSJ Holdings Inc. and Tokio Marine Holdings Inc. led gains among the sector, rising at least 3.3 percent.
Exporters provided the biggest boost to the Topix. Honda, which counts North America as its biggest market for sales, increased 2.3 percent to 3,634 yen. Nintendo Co., a maker of video-game consoles, added 2.2 percent to 12,260 yen.
Sony Corp. climbed 4 percent to 1,972 yen, its highest level since Oct. 7. Bank of America Corp.’s Merrill Lynch unit reiterated its buy rating on the stock, citing expectations for improvements after the electronics company appointed a new chief financial officer.
JFE Holdings gained 2.2 percent to 1,943 yen, Kobe Steel Ltd. advanced 3 percent to 137 yen and Nippon Steel & Sumitomo Metal Corp. added 1.8 percent to 282 yen. Japanese steelmakers and Anglo American have agreed to coal prices of $120 a ton in April through June, 16 percent lower than the previous quarter, the Nikkei newspaper reported yesterday, without identifying where it got the information.
Among shares that fell, the Topix Precision Instruments Index slumped 0.9 percent. Terumo Corp., which makes medical devices, sank 1.7 percent to 2,253 yen.
Accordia Golf Co. plunged 9.2 percent to 1,160 yen, extending a 4.9 percent drop on March 28 when it said it will sell 90 of its 133 golf courses and take out a 20 billion yen loan with warrants for refinancing.
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