Japan Stocks Rise on Factory Output, U.S. Spending; Honda Jumps

By Masaki Kondo

April 30 (Bloomberg) -- Japanese stocks surged after Japan’s factory output rose for the first time in six months and U.S. consumer spending increased the most in two years.

Sony Corp., which gets a quarter of its sales from the U.S., climbed 5.1 percent. Honda Motor Co., Japan’s No. 2 carmaker, leapt 6.4 percent after forecasting an operating profit this year. Fanuc Ltd., the nation’s top maker of industrial robots, surged 5.1 percent after reporting better-than-forecast earnings.

The Nikkei 225 Stock Average jumped 317.06, or 3.7 percent, to 8,810.83 as of 9:42 a.m. in Tokyo. The broader Topix index rose 25.86, or 3.2 percent, to 837.85, with all of its 33 industry groups gaining. Markets in Japan were closed yesterday for a national holiday.

“Various statistics are suggesting the global economy is bottoming out,” said Kenichi Hirano, general manager at Tachibana Securities Co. “Investors are assessing the situation with a greater deal of optimism.”

The Nikkei has risen 6.5 percent in April, adding to last month’s 8.8 percent gain, amid optimism the worst of the global recession is over. The European Commission yesterday said executive and consumer confidence in the region increased in April for the first time in 11 months.

Japan’s industrial production rose in March for the first time in six months, with a 1.6 percent gain from February, the Trade Ministry said today. Economists estimated output increased by 0.8 percent.

Weakening Yen

In New York, the Standard & Poor’s 500 Index climbed 2.2 percent after a government report showed consumer spending, which accounts for about 70 percent of the U.S. economy, climbed at a 2.2 percent annual pace last quarter, the most in two years.

Sony, the world’s No. 2 maker of consumer electronics, advanced 5.1 percent to 2,580 yen, while Toyota Motor Corp., the biggest automaker globally, added 4.9 percent to 3,840 yen. Honda surged 6.4 percent to 2,765 yen. Honda President Takeo Fukui said last week the U.S. car market has hit a bottom, and the automaker expects 10 billion yen in operating profit in the current fiscal year.

The yen weakened against the dollar to as much as 97.72 today from a one-month high of 95.63 on April 28. A weaker local currency boosts the value of repatriated overseas sales for Japanese businesses.

Fanuc surged 5.1 percent to 6,950 yen. Net income fell by almost a quarter to 97.2 billion yen ($995 million) last fiscal year, the company said on April 28, which was still higher than its forecast of 90.6 billion yen.

Nikkei futures expiring in June added 3.6 percent to 8,820 in Osaka and gained 2.1 percent to 8,820 in Singapore.

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