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Nikkei up 117 points at opening

business Updated: Jun 14, 2007 08:46 IST
Aiko Hayashi
Aiko Hayashi
Reuters
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The Nikkei average rose 0.66 per cent on Thursday as high-tech exporters such as Kyocera Corp gained on a weakening in the yen and a rise in US stocks, while Fanuc Ltd climbed on a new factory plan.

Shares of Godo Steel Ltd and other construction-use steelmakers climbed after news on Nippon Steel's additional investment in Godo sparked hopes for industry consolidation. "A rise in US stocks and a softer yen are helping the market," said Tsuyoshi Segawa, equity strategist at Shinko Securities.

"But gains are likely to be limited in the afternoon as investors become cautious before a series of economic events in the United States for clues on whether the volatile US market has really calmed down," he said.

Investors are watching US producer and inflation prices, on Thursday and Friday respectively, to confirm whether the growing inflation fears are justified.

The Nikkei finished the morning up 116.62 points at 17,849.39 and the broader TOPIX index gained 0.74 per cent to 1,758.88.

Trade volume slightly slipped with 949 million shares changing hands on the Tokyo exchange's first section, compared with 1 billion shares on Wednesday morning.

Advancing shares beat decliners by a ratio of nearly three to one.

The dollar hovered near a 4-1/2-year high against the yen on Thursday. A weaker yen is a boon to companies that make the bulk of their sales abroad because it boosts profits when earnings from abroad are brought home.
Segawa also said the market awaits BOJ Governor Toshihiko Fukui's speech on Friday.

The central bank is seen keeping rates on hold at 0.5 percent this time, but is expected to lift them to a 12-year high of 0.75 per cent as early as the July-September quarter, most likely in August.

Exporters, steel makers up

Exporters rose with Kyocera up 1.1 percent at 12,440 yen and Advantest Corp adding one per cent to 5,210 yen. Fanuc advanced 2.6 per cent to 11,970 yen after it said it would build a new plant in Japan, aiming to boost its output of control units used in industrial robots as demand grows from emerging economies like China and India.

Godo Steel jumped 6.9 per cent to 588 yen after Nippon Steel, Japan's largest steelmaker, said it would spend about $50 million to raise its stake in Godo to more than 15 per cent, aiming to strengthen their business alliance.
Nippon Steel was up 1.7 per cent at 878 yen.

Shares of Osaka Steel Co. rose 3.3 percent to 2,185 yen, Yamato Kogyo Co. climbed 4.2 per cent to 4,480 yen, Hokuetsu Metal Co added 3 per cent and Nakayama Steel Works Co jumped 4.6 per cent.

Among other gainers, shares of Fuji Television Network Inc jumped 5 per cent to 252,000 yen after JP Morgan Securities started coverage on the TV broadcaster with an "overweight" rating and target price of 325,000 yen.

Fujitsu Ltd advanced 2.7 per cent to 873 yen after French stock market watchdog AMF cleared Fujitsu's offer of 8.50 euros per share for French computer services group GFI Informatique on Wednesday.

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