Japan Stocks Rise as Germany, France Express Support for Greece - BusinessWeek

September 15, 2011, 3:34 AM EDT By Norie Kuboyama

Sept. 15 (Bloomberg) -- Japanese stocks advanced, with the Nikkei 225 Stock Average rising the most in a week, after German and French leaders said they are convinced Greece will remain in the euro zone and speculation grew that China may help the region’s most-indebted nations.

Kyocera Corp., an electronics maker that gets almost 20 percent of its sales in Europe, added 2.1 percent after the euro appreciated against the yen, boosting the exporter’s earnings outlook. Sumitomo Metal Industries Ltd., Japan’s No. 3 steelmaker, jumped 3.8 percent after Credit Suisse Group AG raised its stock price estimate. Elpida Memory Inc. paced chipmakers higher after saying it may shift some production overseas.

The Nikkei 225 advanced 1.8 percent to 8,668.86 at the 3 p.m. close in Tokyo, its biggest increase since Sept. 7. The broader Topix added 1.4 percent to 751.76, with more than five shares rising for each that fell.

“There was a concern that France and Germany would one- sidedly blame Greece and show no support, but the situation on Greece was not as bad as expected,” said Mitsushige Akino, who oversees about $600 million in Tokyo at Ichiyoshi Investment Management Co. ”Following the stronger euro, more companies sensitive to the euro on earnings will likely be bought.”

The Topix has fallen 16 percent this year amid concern U.S. growth is sputtering and Europe’s debt crisis will damage the banking system, damping demand in two of Japan’s biggest export markets.

Support For Greece

The Standard & Poor’s 500 Index advanced for a third day yesterday in New York, rising 1.4 percent. French President Nicolas Sarkozy and German Chancellor Angela Merkel are “convinced” Greece will remain in the euro area, according to a statement issued by Sarkozy after they spoke to Greek Prime Minister George Papandreou by telephone. Futures on the S&P 500 were little changed today.

China is willing to buy the bonds of nations hit by the debt crisis, Caijing reported on its website yesterday, citing Zhang Xiaoqiang, a vice chairman of the National Development and Reform Commission.

Japanese exporters to Europe gained after the region’s shared currency appreciated against the majority of its most- traded counterparts. The euro advanced to 105.29 yen at the close of stock trading today in Tokyo, compared with 104.83 yesterday.

‘Buying Trigger’

Kyocera added 2.1 percent to 6,750 yen. Ricoh Co., an office-equipment and camera maker that obtains almost a quarter of its revenue in Europe, climbed 2.2 percent to 662 yen.

The euro’s advanced was a “buying trigger,” said Seiichiro Iwamoto, who helps oversee about $35 billion in Tokyo at Mizuho Asset Management Co. “Many companies are hedging for the dollar, but not for the euro. So, the impact from the euro’s appreciation on earnings is big.”

Sumitomo Metal Industries advanced 3.8 percent to 166 yen after Credit Suisse raised its price target for the steelmaker to 230 yen from 220 yen, citing higher prices for the company’s seamless pipes. Nippon Steel Corp. gained 3.6 percent to 231 yen after Credit Suisse raised its profit outlook for Japan’s No. 1 steelmaker.

Elpida, the world’s third-largest memory chipmaker, jumped 5 percent to 564 yen after saying it may shift some production to Taiwan as part of plans to cope with a stronger yen and an industry slump. Elpida has lost 40 percent this year.

Chip-related companies also advanced after the Philadelphia Semiconductor Index, which tracks the performance of 30 industry stocks, rose yesterday for a third day to its highest level since Aug. 3. Dainippon Screen Manufacturing Co., a maker of chip-making equipment, soared 6 percent to 479 yen. Advantest Corp., the world’s biggest producer of chip testers, climbed 2.7 percent to 885 yen.

--With assistance from Toshiro Hasegawa in Tokyo. Editors: Jason Clenfield, John McCluskey.

To contact the reporters on this story: Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net.

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net.

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