Topix Rises Seventh Day as Geopolitical Tensions EaseYoshiaki Nohara and Yuko Takeo
Japanese stocks rose, with the Topix index advancing for a seventh day, as the yen held losses amid signs geopolitical tensions are easing.
Skymark Airlines Inc. surged 28 percent as AirAsia Bhd was said to be considering a bid for the carrier, which the head of the Malaysian airline denied in a Twitter posting. Daikin Industries Ltd., an air-conditioner maker, added 4.2 percent after Credit Suisse Group AG raised its rating. Kansai Electric Power Co. climbed 3.6 percent on a report the utility will apply for a rate increase as early as this autumn.
The Topix gained 0.7 percent to 1,280.29 in Tokyo, the highest close since Aug. 1, and capped the longest winning streak since June 4. All but two of the 33 industry groups advanced. The Nikkei 225 Stock Average climbed 0.8 percent to 15,449.79. The yen was little changed at 102.57 per dollar after falling 0.2 percent yesterday.
“Once geopolitical risks are taken away, investors will return their focus to fundamentals,” said Yusuke Kuwayama, a portfolio manager at Tokio Marine & Nichido Fire Insurance Co. in Tokyo. “Japanese stocks are going strong on the back of strong appetite from domestic investors.”
The Topix has rebounded 13 percent from this year’s low on April 14 amid optimism about the global economy and speculation Japan’s $1.2 trillion Government Pension Investment Fund will buy more domestic shares. Individual investors bought a net 451 billion yen ($4.4 billion) of Japanese equities in the week through Aug. 8, the most since the period ended April 11, according to data from the Tokyo Stock Exchange.
The Red Cross is close to working out details of a safe-passage plan for a Russian aid convoy intended for southeastern Ukraine. The foreign ministers of the two countries “had an intense exchange of opinions” during more than five hours of talks in Berlin, German Foreign Ministry spokesman Martin Schaefer said yesterday.
Israel and Palestinian militants agreed to extend their five-day truce for 24 hours. In Iraq, Kurdish and government forces retook the nation’s largest dam from rebels.
Futures on the Standard & Poor’s 500 Index added 0.1 percent today. The equity measure jumped 0.9 percent yesterday as tensions eased over global conflicts and Dollar General Corp. rallied on merger activity. The National Association of Home Builders/Wells Fargo sentiment measure climbed to 55 this month from 53 in July, the highest level in seven months.
Skymark Airlines surged 28 percent to 230 yen, the biggest increase since October 2008. AirAsia, the region’s largest low-cost carrier, is in discussions with financial institutions on ways to help Skymark, said a person familiar with the matter, who asked not to be identified because they discussions are private. The Nikkei Asian Review earlier reported that AirAsia is considering options for aid to Skymark.
“Never seen such rubbish,” Tony Fernandes, AirAsia group chief executive officer, said in a Twitter posting. “AirAsia has no interest in Skymark in Japan. There have been no discussions with Skymark.”
Daikin added 4.2 percent to 6,872 yen. Credit Suisse upgraded the stock to outperform from neutral, boosting the price target 33 percent to 8,000 yen. The investment bank also raised its rating on Terumo Corp., a maker of medical equipment, to outperform. Terumo gained 3.5 percent to 2,596 yen.
Kansai Electric climbed 3.6 percent to 1,012.5 yen. The Sankei newspaper reported the utility will apply for a power-rate increase as early as this autumn due to a delay in nuclear restarts and higher fuel costs. The company denied the report.
GMO Payment Gateway Inc., which provides credit -ard transaction services for e-commerce companies, gained 3.7 percent to 5,070 yen after announcing a 2-for-1 share split effective Oct. 1.
Chugai Pharmaceutical Co. fell 2.1 percent to 3,745 yen after jumping 15 percent yesterday as parent Roche Holding AG was said to be in talks to buy out the Japanese drugmaker. Bloomberg News reported late Aug. 15 that Roche is in talks to buy remaining the 40 percent of Chugai. Chugai said it’s not in discussions with Roche. The premium Roche would pay for Chugai is difficult to justify, Barclays Plc said.
The Topix traded at 1.2 times book value today, compared with 2.7 for the S&P 500 and 1.8 for the Stoxx Europe 600 Index yesterday.