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Sep 21, 2012, 04:07:29 AM
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Tokyo Shares End Higher As iPhone Sales Kick Off, JAL Tumbles

 

TOKYO--Tokyo stocks ended higher in tepid trading Friday, as buying in defensive shares such as Japan Tobacco was complemented by enthusiasm for mobile phone retailers Softbank and KDDI as sales of Apple's iPhone 5 kicked off amid much fanfare.

The bullishness was enough to offset euro weakness earlier in the session and a plunge in Japan Airlines shares.

The Nikkei Stock Average added 23.02 points, or 0.3%, to 9110.00 following the prior session's 1.6% fall. For the week, the index slipped 0.5%, but is remains up 0.3% for September and up 7.7% year-to-date.

The Topix index of all the Tokyo Stock Exchange First Section issues gained 2.57 points, or 0.3%, to 756.38, with 25 of 33 subindexes ending in positive territory.

Trading volume hit its lowest level of the week, totaling just over 1.6 billion shares.

"The broader market is still digesting U.S. Fed and Bank of Japan easing steps," said Tachibana Securities market advisor Kenichi Hirano.

"In general, the subsequent risk-on mood is starting to come off a bit," added an equity trading director at a foreign brokerage. "Combined with the upcoming September 28 ex-dividend date, players shifted into higher-yielding defensive shares today."

Japan Tobacco, a perennial conservative equity pick, was the single heaviest-weighted positive Nikkei contributor, gaining 2.9% at Y2,336.

Softbank and KDDI helped carry the market early before profit-taking set in later; the pair ended down 0.5% at Y3,145 and up 0.5% at Y575,000, respectively, as sales of Apple's new iPhone 5 kicked off Friday in Japan, to mostly positive reviews.

"iPhone 5 sales expectations in Japan are strong, especially that users of competing mobile phones may switch over," said Hideyuki Ishiguro, strategist at Okasan Securities. "But Softbank and KDDI have so outperformed the market that additional share price upside may be hard to realize." Year-to-date, the pair are now up 39% and 17%, respectively.

Drugmakers ranked among the better-performing groups. Eisai added 0.8% at Y3,595 while Astellas Pharma surged 1.4% at Y3,990. Astellas also benefited from a Credit Suisse target price hike to Y4,500 from Y4,100, citing increased prospects for earnings contributions from Xtandi, the firm's new prostate cancer treatment.

Shares of Sharp closed up 5.0% at Y212 on heavy volume following a Mainichi Shimbun report that the firm is in talks with U.S. chipmaker Intel on a capital alliance. Intel may invest more than Y30 billion in Sharp, possibly making it Sharp's top shareholder, the paper said. Sharp denied the report.

Japan Airlines fell suddenly in afternoon trading, closing down 4.3% at Y3,680--well under its Y3,790 IPO price--after the firm said during the midday break that about 6,000 passengers had cancelled Japan-China JAL flights.

"While the fallout appears to be confined to JAL's stock at the moment, the danger is that individual investors burned on its IPO will turn reticent on investing in the rest of the market, since many had sold other holdings to make room for JAL in their portfolios," said Investrust CEO Hiroyuki Fukunaga. Seventy percent of JAL's IPO shares were distributed to retail investors before re-listing Wednesday.

December Nikkei 225 futures gained 70 points, or 0.8%, at 9060 on the Osaka Securities Exchange.



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