Japanese Market Advances

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The FINANCIAL — The Japanese stock market is extending gains on October 1 from the previous session, tracking the strong gains overnight on Wall Street and in European markets, according to Nasdaq.

Investors shrugged off the Bank of Japan’s weaker than expected quarterly Tankan survey results, which showed that business sentiment in Japan weakened in the third quarter of 2015.

In late-morning trades, the benchmark Nikkei 225 Index is adding 171.41 0.99 17559.56, off a high of 17,561.56 earlier. Shipping, precision instruments and financing business stocks are among the major gainers.

Exporters are higher despite a stronger yen. Sony (SNE) is rising more than 2 percent, Panasonic is advancing almost 2 percent, Canon is up almost 1 percent and Toshiba is higher by 0.5 percent. Meanwhile, Sharp Corp. is down more than 2 percent.

Automakers are also higher. Toyota (TM) is advancing more than 2 percent and Honda (HMC) is adding 0.6 percent.

Market heavyweight Fast Retailing is up 0.4 percent and SoftBank is adding 0.5 percent.

In the banking space, Mitsubishi UFJ Financial (MTU) is rising almost 2 percent, while Mizuho Financial Group (MFG) is adding almost 1 percent and Sumitomo Mitsui Financial is up almost 2 percent each.

Among the other major gainers, Mazda Motor is gaining more than 5 percent, while Nissan and GS Yuasa are rising more than 3 percent. Meanwhile, Kyowa Hakko Kirin is down more than 3 percent and Japan Tobacco is losing more than 2 percent.

On the economic front, the Bank of Japan said in its quarterly Tankan business survey that an index measuring business sentiment in Japan weakened in the third quarter of 2015.

The large manufacturers’ index came in with a score of 12, missing forecasts for 13 and down from 15 in the previous quarter. The outlook came in with a score of 10, matching forecasts but down sharply from 16 in the three months prior.

The latest survey from Nikkei revealed that the manufacturing sector in Japan remained in expansion territory, with a final manufacturing PMI score of 51.0.

That was up from last month’s preliminary score of 50.9, although it was down from the eight-month high reading of 51.7 in August. It also remained well above the boom-or-bust line of 50 that separates expansion from contraction.

In the currency market, the U.S. dollar traded in the upper 119-yen range on October 1, down from Wednesday’s close in the lower 120 yen-range in Tokyo.

On Wall Street, stocks closed sharply higher on September 30, partly in reaction to rallies by stocks overseas. Traders also reacted positively to a report from payroll processor ADP showing stronger than expected private sector job growth in the month of September.

The Dow jumped 235.57 points or 1.5 percent to 16,284.70, the Nasdaq soared 102.84 points or 2.3 percent to 4,620.16 and the S&P 500 surged up 35.94 points or 1.9 percent at 1,920.03.

The major European markets also showed substantial moves to the upside on September 30. While the German DAX Index jumped by 2.2 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index both shot up by 2.6 percent.

U.S. crude oil futures ended slightly lower on September 30, after a report from the U.S. Energy Information Administration showed an increase in crude stockpiles last week, although the loss was somewhat limited as domestic production declined due to the refinery maintenance season.

Crude Oil futures for November delivery, the most actively traded contract, dropped $0.14 or 0.3 percent to settle at $45.09 a barrel on the New York Mercantile Exchange on September 30.


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