Japanese market moves in the first session of the month underscored how highly sensitive its stock prices are to currency fluctuations.
The broader Topix index added less than 0.1% while the Nikkei kept 0.4% plunge. Businesses are mulling steps to improve their balance sheets and avoid the impact of recent foreign exchange trends. The yen has strengthened recently.
According to UBS Securities senior economist Takuji Aida, the equity market was digesting uncertainties over the economic outlook and concern about the yen’s appreciation.
Shares of electronics and media giant Sony Corp lost 0.7%. The company reported its results three years ago, swinging to ¥68.65 billion ($ 847 million) operating profit for the most recent quarter thanks to strength in game and personal computer business. For the full year through March 2011, the giant hiked its profit outlook to ¥200 billion from ¥180 billion. It hopes that the dollar will be traded at ¥83 in the second half.
Honda Motor released over doubled quarterly profit. The company overcame the impact of the strengthening yen due to strong automobile and motorcycle sales in North America and Asia. Its fiscal second-quarter net income rose to 135.9 billion yen. Revenue for the most recent quarter rose 9.5% to ¥2.25 trillion. However, its shares slipped 4.5% on Monday.
215 out of the 475 companies had reported its results in the third quarter by last Friday.
In other Asian markets, stocks were higher in Monday trading. Australia’s S&P/ASX 200 added 0.7%. In South Korea, the Kospi gained 1.1%.
The Shanghai Composite advanced 1.9%, and Hong Kong’s Hang Seng Index was up 1.8%.
Twin measure of manufacturing activity in China unexpectedly strengthened in October. The strength raised expectations that more interest rate hikes could be on the cards.
The fast expansion of China’s manufacturing sectors provided some reassurance on the strength of the world’s economic recovery.
In Europe, stock markets kicked off the first day of November on a positive note amid hopes on Fed’s additional action.
The Stoxx Europe 600 index edged up 0.5% to 267.32. France’s CAC 40 index gained 0.8% to 3,863.52. Germany’s DAX 30 climbed 0.7% to 6,648.24. The UK’s FTSE 100 Index was up 0.7% to 5,712.07.
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