By Masaki Kondo
Jan. 6 (Bloomberg) -- Japanese stock rose, leading the Nikkei 225 Stock Average to its longest winning streak in 18 months, as the weakening yen improved the earnings outlook for automakers and electronics manufacturers.
Canon Inc., which gets a third of its sales from the Americas, rose 2.8 percent after the Japanese currency sank to a one-month low versus the dollar. Nintendo Co., the world’s biggest maker of handheld game players, rallied 2 percent after Nomura Securities Co. estimated its share price will rise 24 percent to 45,000 yen in the next 12 months. Tokyo Electric Power Co. dropped 0.7 percent after oil extended its gain to a third day.
The Nikkei 225 Stock Average climbed 59.28, or 0.7 percent, to 9,102.40 as of 9:50 a.m. in Tokyo, poised for the longest winning streak since July 2007. The broader Topix index rose 1.21, or 0.1 percent, to 877.12, with almost the same number of stocks rising and falling.
The yen’s retreat may give breathing room to Japanese companies that depend on overseas sales, as the global economic slump cuts demand. Dimming earnings prospects in 2008 prompted investors to sell off automakers and electronics manufacturers, causing Toyota and Sony Corp. to lose more than half their value last year.
The yen depreciated against the dollar to as much as 93.60 today, the weakest level since Dec. 8, from 92.03 at the 11 a.m. close of stock trading in Tokyo yesterday. The local currency strengthened to as much as 93.05 today.
Canon, the world’s biggest digital-camera maker, added 2.8 percent to 2,910 yen, while Sony climbed 2.3 percent to 2,015 yen. Panasonic Corp., the world’s largest maker of consumer electronics, rose 1.4 percent to 1,157 yen. Electronics makers were the biggest contributors to the Topix’s gain.
Nintendo, Utilities
A 1 yen change against the dollar alters Canon’s annual operating profit by 2.6 billion yen ($28 million), the company said in October. A weaker yen increases the value of overseas sales when revenue is repatriated.
Nintendo, the world’s biggest maker of handheld game players, rallied 2 percent to 36,200 yen. The game maker will remain among the nation’s top profit gainers although a stronger yen hurts earnings, according to Nomura.
Tokyo Electric, Asia’s biggest utility, sank 0.7 percent to 2,925 yen, while Kansai Electric Power Co. fell 1 percent to 2,535 yen. Power generators weighed the most on the Topix’s gain.
Crude oil for February delivery jumped 5.3 percent yesterday to $48.81 a barrel, the highest since Dec. 1. Israel’s battle against Hamas fighters in the Gaza Strip boosted concern oil supply in the Middle East, the source of one-third of the world’s supply, will be disrupted. Oil fell as much as 1 percent today.
Chip Prices Rise
A $1 change in a barrel of crude alters Tokyo Electric’s annual fuel costs by 18 billion yen, the company said in October.
Elpida Memory Inc., Japan’s biggest memory-chip maker, jumped 4.5 percent to 625 yen, while NEC Electronics Corp. added 3.6 percent to 854 yen. Prices of the benchmark dynamic random access memory chips rose 5.5 percent on Jan. 5, according to Dramexchange Technolog Inc., Asia’s biggest spot market for chips.
Nikkei futures expiring in March added 0.4 percent to 9,110 in Osaka and gained 0.3 percent to 9,105 in Singapore.
To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.
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