Tokyo: Nikkei gains despite Toyota's plunge on earnings

JAPANESE stocks gained on Thursday (Aug 4) despite an afternoon plunge in Toyota Motor as the country’s biggest automaker posted a large drop in quarterly earnings.

Japan’s Nikkei share average closed up 0.69 per cent at 27,932.20 after briefly breaking through the 28,000 barrier, which it hasn’t finished above since Jun 9.

The broader Topix index was more muted, closing flat at 1930.73 after bouncing between positive and negative territory throughout the day.

Toyota fell 3.45 per cent after it released its earnings report, which showed a 42 per cent year-on-year decline in operating profit, before paring losses slightly to close down 2.99 per cent.

“I can’t say the results were good, but they weren’t so bad as to be a surprise,” said a market participant at a domestic securities firm.

“We’d like to analyse Toyota’s results,” Kyoko Amemiya of Amemiya Research Institute said ahead of the release. “Toyota’s performance could indicate the direction of the overall market.”

Rival automaker Subaru was the best performer on the Nikkei on Thursday, gaining 8.48 per cent after a positive earnings report and optimistic forecasts for future sales in the US.

Of the Nikkei’s 225 components, 109 made gains, 113 made losses, and 3 were flat.

Casio Computer Co gained the most after Subaru, adding 6.29 per cent after forecasting stronger profits for its current financial year.

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Other technology companies helped the Nikkei after the Philadelphia SE Semiconductor Index gained 2.65 per cent overnight. Sumitomo Electric Industries was up 5.96 per cent and Tokyo Electron added 3.1 per cent.

The worst performer was Z Holdings, the operator of Yahoo Japan and Line, which fell 10.99 per cent after releasing its earnings.

Investors also eyed video game maker Nintendo after it announced a year-on-year slump in Switch console sales, but the stock gained 0.41 per cent. The company’s unit sales forecast for the current fiscal year remains unchanged. REUTERS