Japan Stocks Advance on Policy Expectations; Mizuho, Canon Rise

By Masaki Kondo and Patrick Rial

March 16 (Bloomberg) -- Japanese stocks rose for a second day amid confidence central bank and government measures will help revive economic growth.

Mizuho Financial Group Inc., Japan’s No. 2 listed bank, leapt 5 percent on a Nikkei newspaper report the Bank of Japan may buy subordinated debt issued by banks. Canon Inc., the world’s biggest camera maker, added 4 percent after Group of 20 finance ministers pledged to combat the global recession. Inpex Corp., Japan’s No. 1 oil explorer, lost 2.7 percent as oil- producing nations decided against deeper output cuts.

“The prevailing mood among investors toward stimulus measures has been negative, but now we are seeing some effects start to break through,” Tomochika Kitaoka, a strategist at Tokyo-based Mizuho Securities Co., said in an interview with Bloomberg Television. “We’re now in a situation where it’s possible to see sentiment make an about-face.”

The Nikkei 225 Stock Average climbed 163.77, or 2.2 percent, to 7,733.05 as of 9:39 a.m. in Tokyo. The broader Topix index rose 20.64, or 2.9 percent, to 744.94, with all but two of its 33 industry groups climbing.

The Nikkei jumped 5.5 percent last week, its best since the period ended Nov. 28. The gauge is still down 13 percent in 2009 amid the deepening global recession. The gauge’s members traded at 0.84 times their corporate net worth, according to Nikkei Inc.

The Bank of Japan is considering buying subordinated debt from banks as a means of shoring up capital ratios, the Nikkei newspaper reported today. The central bank is also considering boosting its purchases of long-dated government bonds, the newspaper said on March 14.

Banks, Electronics

Mizuho jumped 5 percent to 188 yen, while market leader Mitsubishi UFJ Financial Group Inc. climbed 5.3 percent to 441 yen. Sumitomo Mitsui Financial Group Inc., Japan’s No. 3 listed bank by assets, leapt 6 percent to 3,020 yen. Banks and electronics makers contributed the most to the Topix’s gain.

Canon gained 4 percent to 2,575 yen, and Panasonic Corp., the world’s largest maker of consumer electronics, advanced 3.1 percent to 1,089 yen. Toshiba Corp., Japan’s largest chipmaker, rose 4.3 percent to 245 yen.

The G-20 is ready to take “whatever action is necessary until growth is restored,” the group said in a statement after meeting near London over the weekend. Its key priority is “to restore lending by tackling” problems in the financial system, the G-20 said. The gathering of finance ministers will be followed by a meeting of world leaders in London on April 2.

Inpex slumped 2.7 percent to 657,000 yen. The Organization of Petroleum Exporting Countries left its production quotas unchanged at a weekend meeting. Oil prices tumbled as much as 5.2 percent to $43.85 per barrel in trading today.

Nikkei futures expiring in June added 2.3 percent to 7,680 in Osaka and rose 1.9 percent to 7,665 in Singapore.

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