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Monday, 2 July 2012
Japanese Stocks Snap Three-Day Win Streak As Yen Advances
By Norie Kuboyama and Toshiro Hasegawa - Jul 2, 2012 10:39 AM GMT+0400
Japan’s Nikkei 225 Stock Average (NKY) snapped a three-day winning streak as the yen strengthened in the last hour of trading and exporters including Nissan (7201) Motor Co. reversed gains. Shares rose earlier after a Bank of Japan survey of manufacturing sentiment beat estimates.
Nissan lost 0.7 percent after rising as much as 2.3 percent after Japan’s currency gained 15 of its 16 major peers. Yamada Denki Co. sank 4.6 percent after JPMorgan Chase & Co. cut the electronics retailer’s target price. Nippon Yusen K.K. jumped 2.4 percent on a plan to double sales at the shipping line’s logistics operations.
The Nikkei 225 fell less than 0.1 percent to 9,003.48 at the 3 p.m. close in Tokyo after rising as much as 1.1 percent, with volume almost 20 percent below the 30-day average. The broaderTopix Index (TPX) dropped 0.1 percent to 769.34. Both indexes rose 1.5 percent on the previous trading day after European leaders struck agreements on the debt crisis.
“The EU summit yielded a policy on Spain, but investors are concerned that a lot of the details still aren’t decided,” said Takashi Miyazaki, a senior strategist who helps oversee about $70 billion at Mitsubishi UFJ Asset Management Co. in Tokyo. “Europe’s problems aren’t front-and-center for the moment, but markets are going to continue to be jittery unless the U.S. economyshows signs of improvement. Investors are feeling less risk averse, but it’s still difficult to see a bullish scenario.”
The Topix has rebounded more than 10 percent since June 4, when the index fell to its lowest level since 1983. Stocks rose after Greek voters elected pro-bailout parties and European leaders agreed to ease repayment rules for Spanish banks and make it easier to recapitalize the region’s troubled lenders.
Shares on Japan’s broadest equities gauge traded at an average of 1.1 times book value, compared with 2.2 times for the Standard & Poor’s 500 Index and 1.4 times for the Europe Stoxx 600 Index. A number less than one means that companies can be bought for less than value of their assets.