Tokyo Market: Exporters benefit from currency boost

JAPANESE exporters are likely to gain this week on expectations that the government's efforts to lead down interest rates will weaken the yen. Banks may fall as corporate shareholders sell before fiscal-year book closing at the end of this month.

Sony, Fuji Photo Film and other companies that rely on US sales are set to gain amid waning concern that a stronger Japanese currency will squeeze overseas earnings. The dollar rose to a three-week high of Y123.43 on Thursday as the Bank of Japan pumped in money, pushing down government bond yields.

While the benchmark Nikkei 225 index rose 3.6 per cent last week - rescued by a 5 per cent gain on Friday alone - the market may be held back in coming days by banks. The end of the Japanese fiscal year on 31 March is ratcheting up pressure on banks to cash in long-held stocks to offset extraordinary losses incurred in part as they restructure money-losing operations.

"You've got foreign investors starting to feel uncomfortable about Japan being so underweight in their portfolio," said Yoshio Inamura, a portfolio manager at Tokyo-Mitsubishi Asset Management, which manages Y20bn (pounds 101m). "On the other hand, domestic institutions are still looking for chances to sell before book closing."

The Nikkei is likely to move between 14,500 and 15,500, Inamura predicted. He expects trading to be volatile because next Friday is settlement day for March Nikkei futures and options contracts, and during the run-up investors will try to push the benchmark in line with their positions.

The broader Topix index of all shares on the first section of the Tokyo Stock Exchange gained 2.4 per cent to 1146.72. The prospect of a weakening yen and falling interest rates helping Japan's struggling economy may encourage investors to take another look at Japanese stocks. Also improving sentiment is news that Sony and Toshiba are working together to produce cutting-edge microchips.

Sony, which last week unveiled the successor to its best-selling PlayStation video game, said it will form a joint venture with Toshiba to make the high-performance chips that will power the new machine.

Falling yields on government bonds may spur buying of utilities such as Tokyo Electric Power that typically offer high dividend returns. At 1.99 per cent, Tokyo Electric's dividend yield is higher than the yield on the benchmark government bond, which Friday fell to 1.56 per cent. Investors looking for protection from earnings revisions will seek safety in drug makers and telecommunications companies.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Arts and Entertainment
Peter Mayhew as Chewbacca alongside Harrison Ford's Han Solo in 'Star Wars'
film
News
i100
Arts and Entertainment
British actor Idris Elba is also a DJ and rapper who played Ibiza last summer
filmIdris Elba responds to James Bond rumours on Twitter
News
Hackers revealed Oscar-winning actress Lawrence was paid less than her male co-stars in American Hustle
people
Arts and Entertainment
Ellie Levenson’s The Election book demystifies politics for children
bookNew children's book primes the next generation for politics
News
Outspoken: Alexander Fury, John Rentoul, Ellen E Jones and Katy Guest
newsFrom the Scottish referendum to the Ice Bucket Challenge, our writers voice their opinions
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Sport
Adnan Januzaj and Gareth Bale
footballManchester United set to loan out Januzaj to make room for Bale - if a move for the Welshman firms up
Arts and Entertainment
Lena Headey as Cersei Lannister in Game of Thrones
film
News
i100
Sport
Yaya Sanogo, Mats Hummels, Troy Deeney and Adnan Januzaj
footballMost Premier League sides are after a striker, but here's a full run down of the ins and outs that could happen over the next month
News
Nigel Farage celebrates with a pint after early local election results in the Hoy and Helmet pub in South Benfleet in Essex
peopleHe has shaped British politics 'for good or ill'
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Selby Jennings: Quantitative Research | Equity | New York

Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

Selby Jennings: SVP Model Validation

Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

Day In a Page

War with Isis: The West needs more than a White Knight

The West needs more than a White Knight

Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

'The day I was shot by the Taliban'

Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
Revealed: the best and worst airlines for delays

Revealed: the best and worst airlines for delays

Many flyers are failing to claim compensation to which they are entitled, a new survey has found
The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

The stories that defined 2014

From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

Disaster looming? Now you know where to head...

Which British city has become the first to be awarded special 'resilience' status by the UN?
Finally, a diet that works: Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced

Finally, a diet that works

Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced
Say it with... lyrics: The power of song was never greater, according to our internet searches

Say it with... lyrics

The power of song was never greater, according to our internet searches
Professor Danielle George: On a mission to bring back the art of 'thinkering'

The joys of 'thinkering'

Professor Danielle George on why we have to nurture tomorrow's scientists today
Monique Roffey: The author on father figures, the nation's narcissism and New Year reflections

Monique Roffey interview

The author on father figures, the nation's narcissism and New Year reflections
Introducing my anti-heroes of 2014

Introducing my anti-heroes of 2014

Their outrageousness and originality makes the world a bit more interesting, says Ellen E Jones
DJ Taylor: Good taste? It's all a matter of timing...

Good taste? It's all a matter of timing...

It has been hard to form generally accepted cultural standards since the middle of the 19th century – and the disintegration is only going to accelerate, says DJ Taylor
Olivia Jacobs & Ben Caplan: 'Ben thought the play was called 'Christian Love'. It was 'Christie in Love' - about a necrophiliac serial killer'

How we met

Olivia Jacobs and Ben Caplan
Bill Granger recipes: Our chef's breakfasts will revitalise you in time for the New Year

Bill Granger's healthy breakfasts

Our chef's healthy recipes are perfect if you've overindulged during the festive season
Transfer guide: From Arsenal to West Ham - what does your club need in the January transfer window?

Who does your club need in the transfer window?

Most Premier League sides are after a striker, but here's a full run down of the ins and outs that could happen over the next month
The Last Word: From aliens at FA to yak’s milk in the Tour, here’s to 2015

Michael Calvin's Last Word

From aliens at FA to yak’s milk in the Tour, here’s to 2015