Mitsubishi Corp considers raising stake in Mitsubishi Motors in tender offer

Asian Stock Markets

Trading house Mitsubishi Corp (8058.T) said on Tuesday it was considering raising its stake in Mitsubishi Motors (7211.T) via a tender offer, a deal that the Nikkei newspaper reported could be worth about $1.1 billion.

Mitsubishi Corp said in a statement it was considering buying shares in the carmaker held by Mitsubishi Heavy Industries Ltd (7011.T) and Bank of Tokyo-Mitsubishi UFJ, a core unit of Mitsubishi UFJ Financial Group Inc (8306.T), although no decision had been made. 

The Nikkei reported earlier the firm planned to double its interest in Mitsubishi Motors to around 20 percent by spending about 120 billion yen ($1.1 billion) for additional shares through a tender offer.

Mitsubishi Corp held a 9.2 percent interest in Mitsubishi Motors as of last September. 

Mitsubishi Motors and Mitsubishi UFJ Financial Group Inc (8306.T) declined to comment. 

A Mitsubishi Heavy spokeswoman said the firm was considering what to do with its stake in the carmaker but that nothing had been decided. 

Earlier this month, Nikkei had reported that sister company Mitsubishi Heavy Industries had decided to sell most of its 10 percent stake in Mitsubishi Motors, with Mitsubishi Corp slated as the likely buyer.

Nikkei posts solid rise despite strong yen; financials higher

Asian Stock markets

Japan’s Nikkei share average rose significantly on Thursday as investors bought back recently-battered stocks after U.S. markets climbed overnight, shrugging off stronger-than-expected inflation data. 

The Nikkei ended 1.5 percent higher at 21,464.98, after tumbling to a four-month low on Wednesday and briefly dipping below its 200-day moving average. 

A total of 28 out of 33 sectors were in positive territory, with financial stocks and exporters outperforming, ignoring the strong yen. 

The dollar dropped below Wednesday’s low of 106.725 yen and fell as far as 106.30 yen, its weakest level since November 2016. 

That marked a drop of 3.8 percent from its early February peak near 110.50 yen. 

Short-term investors like overseas hedge funds were shorting Japanese stocks and futures since late January. 

They have their trades programmed to sell Japanese stocks when U.S. stocks fell. 

But since U.S. stocks rose overnight, they had to close such positions as there was a risk of losing.

Japanese stocks have seen volatile trade in recent weeks after hitting 26-year highs last month. 

Some traders say that repercussions from Wall Street’s recent tumble have not undermined Japanese stocks’ attractive valuations. 

Insurance stocks soared on Thursday with Dai-ichi Life Holdings jumping 5.0 percent and T&D Holdings surging 2.6 percent. 

Banks also rallied, with Mitsubishi UFJ Financial Group rising 1.8 percent and Mitsui Sumitomo Financial Group gaining 1.7 percent. 

Exporters gained ground, with Tokyo Electron surging 4.6 percent and Honda Motor Co gaining 1.3 percent.

Abe hopes BOJ to keep 'bold' monetary easing, Japan not out of deflation

Asian Stock Markets

Japanese Prime Minister Shinzo Abe said on Monday he hoped the central bank would continue to promote “bold” monetary easing, as the economy has yet to emerge decisively from deflation. 

Abe rebuffed the view the Bank of Japan’s 2 percent inflation target was too ambitious for a country mired in two decades of deflation, saying the central bank’s commitment and actions to hit the target had helped revive the economy.

He also said it was premature to declare an official end to deflation despite growing signs of strength in the economy.

The remarks come ahead of a leadership change at the BOJ with the five-year terms of Governor Haruhiko Kuroda and his two deputies expiring in April and March, respectively.

The government is seen presenting to parliament its nominees around mid- to late February at the earliest, sources say, with a strong chance Kuroda will be reappointed.

Kuroda told the same parliamentary committee the BOJ was in no rush to withdraw its massive stimulus program.

He conceded that prolonged monetary easing was adding to strains for regional banks, already suffering from narrowing margins due to an ageing population.

A strengthening economy and subdued inflation have posed a dilemma for the BOJ, which is forced to sustain crisis-mode stimulus despite rising costs, such as the drag on bank profits from near-zero rates.

Kuroda has struggled to hose down speculation the BOJ could follow in the footsteps of its U.S. and European peers in dialing back stimulus, driven in part by signs of recovery in the economy.

The Nikkei 225 is poised for more gains

Asian Stock Markets

Japanese Prime Minister Shinzo Abe famously launched his three arrows in the fall of 2015. They seemed to achieve nothing for Japan's economy, apparently fluttering to earth, and the media lost interest.

The performance of the Nikkei 225, however, suggests that at least some of the arrows, aggressive monetary easing, fiscal stimulus and structural reforms, reached their targets. Although there is a focus on the 21,000 level it is the 20,800 level that is much more important technically.

The move above that level breaks a long-term multi-year triple-top pattern. That level acted as support in 1990. The level acted as a resistance level in 1994, 1997, 2000 and again in 2015. It is a very powerful resistance level and that makes the breakout particularly significant because it signals a substantial change in economic outlook.

The Nikkei did move above that level for a few weeks in 1996 to peak near 22,000. A current move above 22,000 will act as further confirmation of the strength of this breakout and its significance.
Between 1987 and 1991 the Nikkei created a very large head-and-shoulder pattern. What is important today about this pattern is the equal highs made by each of the shoulders. This creates a historical resistance level near 26,500.

This is the next longer-term resistance target for the current Nikkei breakout.

The very same people who have been consistently frightened by the continued rise of the Dow, the S&P and the Nasdaq over the past 18 months are now also frightened by the rise in the Nikkei.
Rather than see any pullback as a buying opportunity, they see the pullback as a warning the market will collapse.

The Guppy Multiple Moving Average (GMMA) indicator analysis confirms the strength of the trend. The long-term group of averages is well separated. This shows investors are very confident about the strength and continuity of the trend. There is short-term trading activity.

This is shown by the short-term group of averages. The compression and expansion activity shows traders taking short-term profits. They are not quite as confident as investors.
The key feature is the way the pullback in April and September used the lower edge of the long-term GMMA as a support level for the subsequent rebound rally.

That behavior suggests that any pullback is a buying opportunity.

Japanese Prime Minister Shinzo Abe famously launched his three arrows in the fall of 2015. They seemed to achieve nothing for Japan's economy, apparently fluttering to earth, and the media lost interest.

The performance of the Nikkei 225, however, suggests that at least some of the arrows, aggressive monetary easing, fiscal stimulus and structural reforms, reached their targets.

Although there is a focus on the 21,000 level it is the 20,800 level that is much more important technically.

The move above that level breaks a long-term multi-year triple-top pattern. That level acted as support in 1990. The level acted as a resistance level in 1994, 1997, 2000 and again in 2015. It is a very powerful resistance level and that makes the breakout particularly significant because it signals a substantial change in economic outlook.

The Nikkei did move above that level for a few weeks in 1996 to peak near 22,000. A current move above 22,000 will act as further confirmation of the strength of this breakout and its significance.
Between 1987 and 1991 the Nikkei created a very large head-and-shoulder pattern. What is important today about this pattern is the equal highs made by each of the shoulders. This creates a historical resistance level near 26,500.

This is the next longer-term resistance target for the current Nikkei breakout.

The very same people who have been consistently frightened by the continued rise of the Dow, the S&P and the Nasdaq over the past 18 months are now also frightened by the rise in the Nikkei.
Rather than see any pullback as a buying opportunity, they see the pullback as a warning the market will collapse.

The Guppy Multiple Moving Average (GMMA) indicator analysis confirms the strength of the trend. The long-term group of averages is well separated. This shows investors are very confident about the strength and continuity of the trend. There is short-term trading activity.

This is shown by the short-term group of averages. The compression and expansion activity shows traders taking short-term profits. They are not quite as confident as investors.

The key feature is the way the pullback in April and September used the lower edge of the long-term GMMA as a support level for the subsequent rebound rally.
That behavior suggests that any pullback is a buying opportunity.

The index is clustering near the upper edge of the short-term GMMA. This is very bullish so traders will watch for consolidation to develop.

Typically this has been a sideways movement, followed by a retreat and rapid rebound. Any move toward 21,000 will represent a buying opportunity as the rebound develops.

Nikkei rises, led by banks, financials; shrugs off North Korean missile launch

Asian Stock Markets

 Japanese stocks rose on Wednesday as banks and financial shares tracked their U.S. counterparts higher, shrugging off another North Korean missile launch.

The Nikkei share average ended 0.5 percent higher at 22,597.20, while the broader Topix advanced 0.8 percent to 1,786.15.

Japan's Nikkei 225 shrugged off the North's latest missile launch to rise 0.31 percent. Major exporters were mixed as the dollar held onto overnight gains against the yen, with automakers mixed, but tech names mostly higher. Trading houses and financials notched gains.

Retail sales in October declined 0.2 percent compared to one year ago, although the figure remained in line with what was forecast in a Reuters poll. That was the first fall in yearly retail sales in a year, Reuters said.

Across the Korean Strait, the benchmark Kospi index was little changed, trading higher by 0.01 percent as several blue-chip tech names declined. Heavyweight Samsung Electronics lost 1.2 percent while companies that have been sensitive to developments related to the THAAD anti-missile system traded mixed: Lotte Shopping fell 2.11 percent and LG Household and Healthcare advanced 0.08 percent.

Shares of cosmetics names Amorepacific and Cosmax were up 1.29 percent and 4.47 percent, respectively, following news that China would once again let travel agencies resume selling tour packages to South Korea.

Down Under, the S&P/ASX 200 was 0.43 percent higher, with heavily-weighted financial stocks climbing 0.66 percent. Sector-wise, utilities and retail names traded higher.

Greater China markets came under some pressure. Hong Kong's Hang Seng Index slipped 0.3 percent.

On the mainland, the Shanghai Composite shed 0.47 percent and the Shenzhen Composite edged down 0.76 percent. Blue chips sold off on the mainland, with the CSI 300 index down 0.92 percent.

Meanwhile, MSCI's broad index of shares in Asia Pacific excluding Japan was slightly higher, rising 0.11 percent at 1:03 p.m. HK/SIN.

Nikkei falls as higher yen, China market woes knock sentiment; Nintendo soars

Asian Stock Markets

Japan’s Nikkei share average fell on Monday in choppy trade after a slightly stronger yen sapped investors’ risk appetite, sending stocks such as chip-related firms lower.

The Nikkei dropped 0.2 percent to 22,495.99, after opening 0.5 percent higher.

Semiconductor equipment makers underperformed, with Tokyo Electron Ltd shedding 1.8 percent and Advantest Corp declining 1.0 percent. Silicon wafer maker Sumco Corp fell 4.0 percent.

Traders said the dollar’s weakening against the yen and an extended selloff in Chinese stocks soured the mood. The dollar fell 0.2 percent to trade at 111.39 yen.

Non-ferrous metal stocks also underperformed, with Mitsubishi Materials Corp shedding 2.0 percent and Sumitomo Metal Mining declining 1.8 percent.

Bucking the weakness, Nintendo Co soared 2.4 percent on hopes that Nintendo Switch games console would post strong sales during the U.S. holiday season.

The broader Topix shed 0.2 percent to 1,776.73.

Nikkei rises to 1-week high but breaks 9-week winning streak

Asian Stock Markets

Japan’s Nikkei share average rose to a one-week high on Friday, helped by gains in most sectors while chip-related stocks such as Sumco and Tokyo Electron outperformed.

 The Nikkei ended 0.2 percent higher to 22,396.80, the highest closing since Nov. 10. However, it fell 1.3 percent for the week, snapping a nine-week winning streak.

Semiconductor equipment maker Tokyo Electron gained 1.0 percent and semiconductor silicon wafer manufacturer Sumco Corp surged 4.9 percent.

Consumer electronics products makers also staged a rally. Sony Corp gained 0.7 percent and Panasonic Corp advanced 0.8 percent.

On the other hand, utility stocks and paper shares slipped and were the worst performers on the board. Chubu Electric Power dropped 1.1 percent, Hokuriku Electric Power shed 1.4 percent and Tokyo Gas declined 1.7 percent.

Nippon Paper Industries dropped 1.4 percent and Oji Holdings declined 1.2 percent.

The broader Topix gained 0.1 percent to 1,763.76.

A Top Asia Fund Manager Says This Stock Selloff Is a Time to Buy

Asia Stock Markets

As the stock selloff extended in Asia on Wednesday, one top money manager was anything but concerned.

Alan Richardson, who oversees about $446 million for Samsung Asset Management Ltd. in Hong Kong, says the four-day decline in the region’s equity markets is nothing more than investors locking in profits before they close their books for the year. The manager of the Samsung Asean Equity Fund, which has beaten 97 percent of peers over the past five years, says the broader trend of global economic growth is intact, and he’s using this opportunity to buy more shares.

Japanese stocks tumbled in Wednesday afternoon trading in Tokyo, with the benchmark Topix index heading for its biggest drop since March. The nation’s equities started sliding late last week and have been retreating ever since, with the fallout spreading to other markets. The sudden rout comes after big gains that sent a measure of Asian shares within touching distance of a record close. The region’s benchmark gauge has lost more than 2 percent in four straight days of declines.

Other strategists and fund managers contacted Wednesday had similar views:

Jason Low, (Senior investment strategist at DBS Group Wealth Management in Singapore) said stock investors are probably taking some profits off the table after doing “extremely well” and market participants likely winding down towards year end


Noriyuki Sato (Chief investment officer for Asset Management One SP in Singapore) said Asian stock markets are correcting as they have been “quite overbought”

Jonathan Ravelas (Chief market strategist at BDO Unibank Inc. in Manila) said this is just a pause that is healthy for the market considering the sharp rally it’s gone through in the past two weeks.

Narongsak Plodmechai (Chief investment officer at SCB Asset Management Co. in Bangkok) thinks Correction is “understandable” after a sharp rally and some investors may want to “lock up their profits before going for holiday in next few weeks.

Nikkei jumps to near 26-year high as foreigners buy on strong earnings hopes

Asian Stock Markets

Japan’s Nikkei index jumped to a near 26-year-high on Tuesday morning, as foreign investors piled in on expectations of strong earnings from Japan Inc., while Wall Street’s strength underpinned sentiment. 

The Nikkei share average opened lower but later gained as much as 1.0 percent to 22,775.68 in morning trade, the highest level since January 1992. 

U.S. stocks climbed to record highs overnight, helped by earnings optimism and merger activity.

Foreign investors who were underweight on Japanese stocks in the summer are raising their investment stances to neutral and even overweight for a few reasons.

According to Japan Exchange Group, foreign investors have bought a total of about 4.4 trillion yen ($39 billion) in Japanese stocks and futures over the past six weeks. 

Traders said factory automation equipment makers such as Fanuc Corp and Keyence Corp have been snapped up on expectations of strong earnings, soaring 2.1 percent and 2.9 percent, respectively.

Inpex Corp jumped 3.6 percent and Japan Petroleum Exploration Co soared 3.9 percent after oil prices hit the highest since early July 2015 on Monday, before edging down during Asian trade on Tuesday. 

Realtor Mitsubishi Estate Co jumped 4 percent after the company raised its net profit outlook to 112 billion yen from 108 billion yen for the fiscal year ending March 2018, thanks to strong building management business and other operations. It lifted other realtor stocks, with Mitsui Fudosan gaining 1.2 percent. 

Listed brokerage firms also gained, with Nomura Holdings surging 2.7 percent and Daiwa Securities advancing 1.5 percent. The broader Topix rose 0.6 percent to 1,802.85.