Japan's Commodity Stocks Advance on Oil, Gold; Retailers Slump

By Masaki Kondo

June 30 (Bloomberg) -- Japan's commodities-related stocks advanced after higher prices for crude oil, gold and copper boosted profit prospects, while retailers fell on signs consumers are cutting back spending.

Sumitomo Metal Mining Co., the nation's largest gold producer, jumped for the first time in five days, while oil explorer Inpex Holdings Inc. gained the most in two weeks. Takashimaya Co., Japan's third-biggest department store operator, tumbled after cutting its full-year sales forecast.

The Nikkei 225 Stock Average dipped 5.56, or less than 0.1 percent, to 13,538.80 as of 9:48 a.m. The broader Topix index rose 3.29, or 0.3 percent, to 1,323.97. Almost the same number of stocks rose and fell on the Topix.

``Investors may be seeking safe havens in trading companies,'' Tomochika Kitaoka, a Tokyo-based strategist at Mizuho Securities Co., said in an interview with Bloomberg Television.

Crude oil jumped to as high as $142.99 a barrel in New York on June 27 as falling stock markets prompted investors to pile into commodities. Gold touched the highest in a month, while copper extended its gain to a second day.

Sumitomo Metal advanced 2.2 percent to 1,618 yen, while Nippon Mining Holdings Inc., the largest copper producer, jumped 3.4 percent to 664 yen. Inpex, Japan's largest oil and gas explorer, rose 2.3 percent to 1.31 million yen, en route to the biggest gain since June 9.

Mitsubishi Corp., a trading company that gets half its profit from commodities, rose 3 percent to 3,490 yen. Smaller rival Mitsui & Co. added 1.5 percent to 2,325 yen.

Takashimaya lost 2.8 percent to 949 yen, while larger rival Isetan Mitsukoshi Holdings Ltd. sank 4.8 percent to 1,146 yen, set for the sharpest drop since April 4. Isetan was the biggest loser on the MSCI World Index.

Takashimaya lowered its annual revenue target by 3.5 percent on June 27, saying a decline in the stock market and rising prices for daily goods were hampering consumer demand. The company kept its earnings forecasts unchanged. Shimamura Co., an apparel and housewares chain, dropped 3.1 percent to 6,700 yen after saying first-quarter net income fell 7.9 percent.

Nikkei futures expiring in September added 0.2 percent to 13,560 in Osaka and rose 0.1 percent to 13,560 in Singapore.

To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.