Japan’s Topix Extends 2007 High as Shippers and Brokerages Rise

Japanese stocks rose for a third straight day, led by shippers and brokerages as the Topix index closed at a seven-year high.

Kawasaki Kisen Kaisha Ltd. soared 5.5 percent after Macquarie Group Ltd. upgraded the shipping line’s shares. Nomura Holdings Inc. added 2.9 percent, extending this week’s gain to 7 percent. Japan Tobacco Inc. jumped 5.3 percent after JPMorgan Chase & Co. raised its rating on the company. JSR Corp. slumped 6.6 percent after the maker of rubber products forecast lower-than-expected operating profit.

The Topix added 0.2 percent to 1,624.87 at the close in Tokyo, the highest since November 2007. The Nikkei 225 Stock Average climbed 0.3 percent to 20,187.65 after closing above 20,000 Wednesday for the first time in 15 years. The yen traded at 119.82 per dollar after weakening 0.9 percent over the past three days.

“The world is awash with easy money,” said Ayako Sera, a Tokyo-based market strategist at Sumitomo Mitsui Trust Bank Ltd., which oversees about $474 billion. “With negative yields creeping up in Europe, there’s no place to leave cash. In Japan, while yields aren’t negative, they’re very low. So among the lousy options, putting cash into stocks seems like a reasonable choice.”

Investors bought shipping stocks after Macquarie lifted Kawasaki Kisen’s rating to outperform from neutral, sending the shares 5.5 percent higher. Mitsui OSK Lines Ltd. climbed 3.4 percent, the biggest advance since January.

Nomura rose 2.9 percent, adding to yesterday’s gains of 4.5 percent, as brokerages rose for a second straight day.

Japan Tobacco

Japan Tobacco soared 5.3 percent to a record after JPMorgan upgraded the stock to overweight from neutral. The brokerage lifted its price target 39 percent to 5,000 yen, citing a recovery in Russia’s currency, the largest overseas market for Japan Tobacco.

JSR, which produces resins used in tires, tumbled 6.6 percent after forecasting operating profit in the current fiscal year will rise to 41 billion yen compared with analyst estimates for 46.1 billion yen.

A preliminary Markit/JMMA gauge of Japanese factory output fell to 49.7 in April, the lowest reading in a year and below economist estimates for 50.7. Readings below 50 indicate contraction.

E-mini futures on the Standard & Poor’s 500 Index slid 0.2 percent after the underlying measure gained 0.5 percent on Wednesday in New York. The gauge rose to within 0.5 percent of a record as stronger-than-expected earnings from Coca-Cola Co. and McDonald’s Corp.

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