June 11 (Bloomberg) – Japanese stocks rose, with the
benchmark Nikkei 225 Stock Average (NKY) headed for the biggest gain
since March, on speculation a bailout for Spanish banks will
help stabilize the European debt crisis and after China’s
imports grew faster than expected.
Canon Inc. (7751), a camera maker that gets 31 percent of its
revenue in Europe, advanced 2.9 percent. Fanuc Corp. (6954), a
manufacturer of robotics controls for Chinese factories, rose
2.1 percent. Sharp Corp. (6753), Japan’s largest maker of liquid-
crystal displays, gained 6.6 percent after saying it will
separate its TV panel unit.
The Nikkei 225 Stock Average added 2.3 percent to 8,650.51
as of 10:08 a.m. in Tokyo, poised for the biggest increase since
March 27. The gauge rose 0.2 percent last week, snapping a nine-
week loss. The broader Topix (TPX) Index gained 2 percent to 732.40,
with all 33 of its industry groups climbing.
“The bailout will keep companies that borrow from Spanish
banks from going down all together,” said Kiyoshi Ishigane, a
Tokyo-based senior strategist at Mitsubishi UFJ Asset Management
Co., which oversees the equivalent of $70 billion. “In China,
overseas demand is stronger than expected, while domestic demand
continues to slow. That makes it easy to do more monetary easing
because it has a direct impact on domestic demand.”
The Topix fell 16 percent from this year’s high on March 27
amid concern the European crisis is deepening and as growth in
China slows. Shares on the measure are valued at 0.87 times book
value. A number below one means a company can be bought for less
than the value of its assets.
Spanish Banks
The Standard Poor’s 500 Index (SPXL1) advanced 1.2 percent on
June 8. Futures on the gauge climbed 1.1 percent today after
Spain over the weekend asked euro-zone governments for as much
as 100 billion euros ($125 billion) to rescue its banking system.
Spain became the fourth nation to seek a bailout after Greece,
Ireland and Portugal. Greek voters on June 17 will decide
whether to observe requirements for another rescue.
Japanese companies linked to China gained after the
government yesterday reported imports rose 12.7 percent in May
and exports advanced 15.3 percent, topping estimates.
Another report showed inflation slowed, giving room to
further ease monetary policy. The People’s Bank of China on June
7 reduced benchmark interest rates for the first time since 2008
to bolster slowing growth.
The Nikkei 225 Volatility Index (VNKY) declined 8 percent to 26.27,
indicating traders expect a swing of about 8 percent on the
benchmark gauge over the next 30 days. Trading volume was 16
percent below the 30-day average.
To contact the reporter on this story:
Yoshiaki Nohara in Tokyo at
ynohara1@bloomberg.net
To contact the editor responsible for this story:
Nick Gentle at
ngentle2@bloomberg.net.
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