Japan Stocks Pare Gains as Yen and Oil Reverse, Mitsubishi Dropsby and
Kuwaiti oil workers end strike, sending crude futures lower
Mitsubishi plummets 15% on improper fuel tests announcement
Japanese stocks pared gains in afternoon trading as the yen rose for the first time in three days and a rally in oil prices evaporated. Mitsubishi Motors Corp. plunged the most since 2004.
The Topix added 0.2 percent to 1,365.78 at the close in Tokyo, paring gains of as much as 1.3 percent. The measure jumped 3.3 percent on Wednesday, the most since March 2. The Nikkei 225 Stock Average added 0.2 percent to 16,906.54, after briefly swinging to a loss, as the yen strengthened 0.3 percent to 108.84 per dollar, its first increase since Friday. Mitsubishi’s announcement that it will hold a briefing about its improper handling of fuel economy tests weighed on automakers, the second-largest group on the Topix.
“We started off strong on the back of yesterday’s rally and strength in futures, but the move has petered out,” said Soichiro Monji, chief strategist at Tokyo-based Daiwa SB Investments Ltd. in Tokyo. There’s a lack of conviction as “this week has basically been just one group of people driving markets down then up, while everyone else stayed on the sidelines.”
Mitsubishi Motors plummeted 15 percent, the most since 2004, after scheduling a press conference for 5 p.m. in Tokyo to discuss the improper handling of fuel tests.
The announcement weighed on other automakers, with Nissan Motor Co. erasing a 1.5 percent gain to close 1 percent lower. Auto-parts maker GS Yuasa Corp. dropped 5.7 percent, the most in two months.
Oil rallied on Tuesday as a strike in Kuwait cut output from OPEC’s fourth-biggest member. Prices reversed on Wednesday after workers said they’ll end the strike after the government said it wouldn’t negotiate while the walkout lasted.
West Texas Intermediate crude fell 2.3 percent Wednesday after jumping 3.3 percent on Tuesday. Oil explorer JX Holdings Inc. added 1.9 percent, while Inpex Corp. rose 2 percent.
Data showed Japanese exports shrank 6.8 percent in March from a year earlier, beating economists’ forecasts for a 7 percent drop. It was the sixth straight month of contractions. Imports fell 14.9 percent, less than the 16.6 percent decline estimated.
Kubota Corp. jumped 4.6 percent after the Nikkei newspaper said the machinery maker will look to halve inventory in an effort to boost productivity. Chugai Pharmaceutical Co. climbed 4.2 percent after its parent Roche Holdings AG, which owns 60 percent of Chugai’s stock, slightly beat sales estimates and confirmed its 2016 outlook.
Tokyo Dome Corp., the operator of a baseball stadium and theme park in Tokyo, sank 6.8 percent after Mitsubishi UFJ Morgan Stanley Securities Co. cut its rating to neutral from overweight, citing a negative impact from renovation costs. Konami Holdings Corp. tumbled 6.1 percent after delaying the release of a smartphone game.
Futures on the Standard & Poor’s 500 Index slipped 0.3 percent after the underlying gauge gained 0.3 percent on Tuesday, closing above the 2,100 level for the first time in four months as energy shares rallied amid mixed earnings. UnitedHealth Group Inc. advanced on better-than-estimated results, countering Netflix Inc.’s 13 percent drop and International Business Machines Corp.’s steepest slide since October as earnings disappointed.