Nikkei set to gain as weaker yen buoys exporters

Thu Jan 24, 2013 6:38pm EST

TOKYO, Jan 25 (Reuters) - Japan's Nikkei share average is
set to rise on Friday as a sharp drop in the yen offers a boost
to exporters, while some mid-sized companies are expected to
attract buying from retail investors on rosy earnings
announcements.
    Market players said the Nikkei was likely to trade between
10,700 to 10,900 on Friday, after rising 1.3 percent to
10,620.87 on Thursday. The Nikkei is still 3.0 percent off from
its 32-month high of 10,952.31 marked on Jan. 15.
    The yen tumbled 2 percent against the dollar overnight to
hit a 2-1/2-year low of 90.54 on Thursday after a Japanese
economic official said the government has no problem with the
dollar hitting 100 yen.
    The Nikkei has gained about 23 percent since mid-November on
expectations that new prime minister, Shinzo Abe, will force the
central bank to ease monetary policy to beat deflation. 
    The market's gain stalled earlier this week after the Bank
of Japan said its open-ended commitment to buy assets would kick
in only next year, disappointing investors who had expected far
more aggressive easing measures.
    "Right now, trading cues are basically these two -- currency
moves and quarterly earnings," said Hiroichi Nishi, assistant
general manager of equity research at SMBC Nikko Securities.    
     
    Analysts said that investors may chase the market higher to
add more exporters on Friday as the underlining mood stays
bullish on expectations that company earnings will exceed
forecasts based on conservative foreign exchange assumptions.
    Companies such as Kagome Co, which reported rosy
earnings the previous day, may also gain on retail investors'
buying, they added.
    KDDI Corp will also be in focus after the Nikkei
reported its group operating profit likely climbed 32 percent on
the year to a new quarterly record of around 155 billion yen for
the October-December period.
    "Retail investors are also contributing to high volume
recently, so we continue to focus on that," Nishi said.
    Nikkei futures in Chicago closed at 10,825, up 195
points from the close in Osaka of 10,630.
     
 
> S&P rises for seventh day but 1,500 too steep a climb    
> Yen falls to 2-1/2-year low after official's comment   
> Bond prices fall as jobless claims drop to 5-year low   
> Gold drops 1 percent on technical selling, HSBC cut    
> Oil rises on encouraging economic data, Seaway optimism 
    STOCKS TO WATCH
    
    --Toyota Motor Corp 
    Toyota and BMW AG will jointly research a
lithium-air battery expected to be more powerful than the
lithium-ion batteries used in many hybrid and electric vehicles,
the two firms said. 
    
    --KDDI Corp 
    KDDI's group operating profit likely climbed 32 percent on
the year to a new quarterly record of around 155 billion yen for
the October-December period, driven by the popularity of
smartphones, the Nikkei reported.
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.