Japan Shares Close Up After BOJ Keeps Policy Unchanged

Japanese shares closed higher, after earlier erasing gains as the central bank maintained its bond-buying program. Insurance companies advanced.

A Topix index gauge tracking insurers climbed 1.8 percent after dropping 1.3 percent yesterday. Taiheiyo Cement Corp., the country’s biggest maker of the building material, jumped 4.7 percent after a report the company’s U.S. unit will post its first profit in six years. Toto Ltd., which sells toilets and bathtubs, slid 1.2 percent after its shares were downgraded by SMBC Nikko Securities Inc. Kobe Steel Ltd. fell 1.4 percent as steelmakers dropped the most among the Topix subsectors.

The Topix added 0.5 percent to 1,233.21 at the close of trading in Tokyo after falling as much as 0.1 percent in the afternoon session following the BOJ announcement. About three shares advanced for each that fell. The Nikkei 225 Stock Average increased 0.7 percent to 15,224.11. The yen was little changed at 103.28 per dollar.

“The Bank of Japan is holding onto its trump card of additional easing until after the economy slumps following the tax hike,” said Koichi Kurose, chief economist in Tokyo at Resona Bank Ltd.

The BOJ kept a pledge to expand the monetary base at a pace of 60 trillion to 70 trillion yen per year, the central bank said in a statement in Tokyo today, in line with all but one forecast in a Bloomberg News poll of 34 economists. Just one predicted a boost in stimulus.

Insurers Climb

The Topix Insurance Index gained 1.8 percent today, the most among the broader gauge’s industry groups. Dai-ichi Life Insurance Co., Japan’s biggest listed insurer by sales, gained 2.5 percent to 1,555 yen. Tokio Marine Holdings Inc., the biggest by market value, advanced 1.7 percent to 3,083 yen. NKSJ Holdings Inc. climbed 2.2 percent to 2,681 yen.

Taiheiyo Cement added 4.7 percent to 380 yen. The company’s U.S. operations will have its first profit in six years in the period ending March 2015, the Nikkei newspaper reported today. The North American operations account for 5.7 percent of revenue, according to data compiled by Bloomberg.

Among shares that fell, Toto sank 1.2 percent to 1,450 yen. The stock’s rating was lowered to underperform from neutral by SMBC Nikko Securities.

The Topix Iron and Steel Index slumped 1 percent, the most among the industry groups. Kobe Steel lost 1.4 percent to 140 yen, while JFE Holdings Inc. declined 1 percent to 2,007 yen.

The Topix fell 5.3 percent this year, the biggest drop among major developed markets, after surging 51 percent last year. The gauge traded at 1.21 times book value today, compared with 2.62 for the S&P 500 and 1.86 for the Stoxx Europe 600 Index yesterday. Volume on the Japanese gauge was 28 percent less than the 30-day average today.

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