Japan Stocks Rise in Final Minutes of Day, Extending Weekly Gain

  • Chemical producers and service companies lead the advance
  • Benchmark Topix index caps fifth straight weekly increase

Japanese stocks closed higher, with the Topix index turning positive in the final minutes of trading, as chemical producers and service companies led gains.

The Topix added 0.2 percent to 1,603.18 at the close in Tokyo, reversing a drop of as much as 0.6 percent and ending the week 1.1 percent higher. Almost twice the number of stocks rose as fell on volume 15 percent below the 30-day average. The yen traded at 122.94 per dollar after gaining 0.6 percent on Thursday.

“There’s a lack of catalysts for the market but some people might trade to adjust their positions,” said Ichiro Yamada, general manager of equities at Fukoku Mutual Life Insurance Co. “If the market is going anywhere, then up is the most likely direction.”

Renesas Electronics Corp. surged 11 percent after a report German chipmaker Infineon Technologies AG expressed interest in investing in the Japanese company. Sharp Corp. jumped 4.8 percent after a report the money-losing electronics company’s television business will post a profit next year. Toto Ltd. dropped 1.4 percent after Credit Suisse Group AG lowered its rating on the toilet maker’s stock.

The Nikkei 225 Stock Average added 0.1 percent to 19,879.81, its highest close since Aug. 20. The gauge has risen 14 percent this year, while still short of a high in June before China’s shock devaluation of the yuan roiled global markets.

Lacking in Energy

“The market is lacking energy,” said Tomomi Yamashita, a fund manager at Shinkin Asset Management Co., which oversees $6.3 billion. “Japanese shares have been rising quite a lot but are top-heavy. Investors don’t feel they can buy the Nikkei 225 at 20,000.”

E-mini futures on the Standard & Poor’s 500 Index were little changed. The underlying gauge slipped 0.1 percent Thursday, after fluctuating throughout the day, as a profit warning from UnitedHealth Group Inc. led to a slump in the health-care sector and energy producers followed oil prices lower.

Cosmetics Companies

Cosmetics companies Kao Corp. and Shiseido Co. were the biggest boosts to the Topix Chemicals Index, which led gains among the 33 industry groups on the broader gauge. JPMorgan Chase & Co. reiterated its overweight recommendation on both stocks, while Barclays Plc raised its target price on Kao by 1.4 percent.

Renesas jumped 11 percent, the most since January. The Wall Street Journal reported Infineon is interested in Renesas and that the Japanese company is examining the idea.

Sharp added 4.8 percent after climbing 5 percent on Thursday. Reuters reported Sharp may shut its overseas television plants and still expects its TV business to become profitable next year.

Toto slid 1.4 percent after Credit Suisse cut its rating on the stock to underperform from neutral as it expects to see a tapering of new construction demand in Japan and uncertainty in the Chinese housing market.

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