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Nikkei rises on techs, but capped by profit-taking

Written by: Staff
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TOKYO, Mar 23 (Reuters) The Nikkei average rose 0.75 percent on Thursday after gains in US technology stocks restored confidence in Canon Inc. and others, while firms that have boosted dividends, such as TDK Corp., also gained.

But profit-taking hit Nippon Steel Corp. and Nomura Holdings Inc., capping the Nikkei's gains, while real estate stocks were mixed ahead of a government land price survey.

''The market has taken a cue from the New York market and advanced. But a lack of fresh factors is already sapping (investors') appetite,'' said Hiroaki Kuramochi, managing director at Bear Stearns (Japan).

The Nikkei was up 123.81 points at 16,619.29.

After hitting a six-week closing high earlier this week, the average lost 129 points on Wednesday as news of a delay in Microsoft Corp.'s new operating system hit some technology stocks.

The TOPIX index was up 0.3 percent at 1,691.37.

Yumi Nishimura, manager at Daiwa Securities SMBC's investment advisory section, said demand for individual stocks with strong earnings prospects was strong, boosting such stocks as Canon and Honda Motor Co. Ltd.

''But buying has failed to spread to other stocks. That suggests how reluctant investors are to trade now ahead of the fiscal year-end,'' she said.

Canon extended gains into a seventh session, hitting a lifetime high of 7,930 yen before closing the morning session up 2.2 percent at 7,860 yen.

Honda, Japan's third-biggest auto maker, also hit a lifetime high of 7,280 yen. It ended the morning session at 7,270 yen, up 2.1 percent.

Electronics parts maker TDK rose 2.3 percent to 8,980 yen.

TDK said on Wednesday it would pay a record dividend of 90 yen per share for the fiscal year ending this month, becoming the latest manufacturer to boost its payout due to higher earnings.

The revised dividend, up from its October projection of 80 yen, brings its dividend yield to around 1 percent, which is in line with an average of about 1 percent for Nikkei 225 components.

LAND PRICE SURVEY Property firm Mitsui Fudosan Co. Ltd. reversed early gains to fall 0.19 percent, but Mitsubishi Estate Co. Ltd. rose 0.2 percent.

The government land price survey, due out after the market closes, is expected to offer further evidence of a recovery after a 15-year slump.

Tokyo Gas Co. Ltd. rose 2.3 percent to 525 yen.

Nikko Citigroup in a report on Wednesday upgraded its rating on the stock and its price target, saying Tokyo Gas's earnings are likely to grow substantially by March 2007 and thus its dividend payments have room for growth.

Nippon Steel, down 0.7 percent at 459 yen, and Nomura, down 0.6 percent at 2,535 yen, were among stocks whose high dividend payments have lured investors in the past few weeks.

Elsewhere, non-ferrous smelter Toho Zinc Co. Ltd. added 1.1 percent to 1,086 yen, extending a 10 percent rise on Wednesday.

Zinc hit a new record high of TOKYO, Mar 23 (Reuters) The Nikkei average rose 0.75 percent on Thursday after gains in US technology stocks restored confidence in Canon Inc. and others, while firms that have boosted dividends, such as TDK Corp., also gained.

But profit-taking hit Nippon Steel Corp. and Nomura Holdings Inc., capping the Nikkei's gains, while real estate stocks were mixed ahead of a government land price survey.

''The market has taken a cue from the New York market and advanced. But a lack of fresh factors is already sapping (investors') appetite,'' said Hiroaki Kuramochi, managing director at Bear Stearns (Japan).

The Nikkei was up 123.81 points at 16,619.29.

After hitting a six-week closing high earlier this week, the average lost 129 points on Wednesday as news of a delay in Microsoft Corp.'s new operating system hit some technology stocks.

The TOPIX index was up 0.3 percent at 1,691.37.

Yumi Nishimura, manager at Daiwa Securities SMBC's investment advisory section, said demand for individual stocks with strong earnings prospects was strong, boosting such stocks as Canon and Honda Motor Co. Ltd.

''But buying has failed to spread to other stocks. That suggests how reluctant investors are to trade now ahead of the fiscal year-end,'' she said.

Canon extended gains into a seventh session, hitting a lifetime high of 7,930 yen before closing the morning session up 2.2 percent at 7,860 yen.

Honda, Japan's third-biggest auto maker, also hit a lifetime high of 7,280 yen. It ended the morning session at 7,270 yen, up 2.1 percent.

Electronics parts maker TDK rose 2.3 percent to 8,980 yen.

TDK said on Wednesday it would pay a record dividend of 90 yen per share for the fiscal year ending this month, becoming the latest manufacturer to boost its payout due to higher earnings.

The revised dividend, up from its October projection of 80 yen, brings its dividend yield to around 1 percent, which is in line with an average of about 1 percent for Nikkei 225 components.

LAND PRICE SURVEY Property firm Mitsui Fudosan Co. Ltd. reversed early gains to fall 0.19 percent, but Mitsubishi Estate Co. Ltd. rose 0.2 percent.

The government land price survey, due out after the market closes, is expected to offer further evidence of a recovery after a 15-year slump.

Tokyo Gas Co. Ltd. rose 2.3 percent to 525 yen.

Nikko Citigroup in a report on Wednesday upgraded its rating on the stock and its price target, saying Tokyo Gas's earnings are likely to grow substantially by March 2007 and thus its dividend payments have room for growth.

Nippon Steel, down 0.7 percent at 459 yen, and Nomura, down 0.6 percent at 2,535 yen, were among stocks whose high dividend payments have lured investors in the past few weeks.

Elsewhere, non-ferrous smelter Toho Zinc Co. Ltd. added 1.1 percent to 1,086 yen, extending a 10 percent rise on Wednesday.

Zinc hit a new record high of $2,525 a tonne on Wednesday in London and dealers said the metal has further upside potential.

Anticipated growth in demand for oil and other natural resources, particularly from China, points to a bright outlook for resource-related stocks, said Kenichi Hirano, strategist at Tachibana Securities.

Trade volume fell to 937 million shares, down from 1.14 billion shares on Wednesday morning, the highest since March 10.

Advancers outnumbered decliners 926 to 634.

REUTERS SK RK1015 ,525 a tonne on Wednesday in London and dealers said the metal has further upside potential.

Anticipated growth in demand for oil and other natural resources, particularly from China, points to a bright outlook for resource-related stocks, said Kenichi Hirano, strategist at Tachibana Securities.

Trade volume fell to 937 million shares, down from 1.14 billion shares on Wednesday morning, the highest since March 10.

Advancers outnumbered decliners 926 to 634.

REUTERS SK RK1015

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