Nikkei seen range-bound; Toyota, Honda in focus

TOKYO (BestGrowthStock) – Japan’s Nikkei average is likely to move narrowly on Thursday after U.S. stocks (Read more about the stock market today. ) ended almost flat, but Toyota Motor may weigh after its U.S.-listed shares dropped in active trade on the fallout from its massive recall.

Honda Motor Co will be also in focus after it lifted annual guidance far beyond market expectations, with cost cuts driving a jump in quarterly profit, and added that it anticipates further growth next financial year.

Automakers were among the most active Asian American Depositary Receipts, with Toyota shedding 6 percent, in its most active trade in at least a decade, while Honda Motor jumped 6.3 percent.

“The market will likely start higher helped by signs of recovery in the global economy and corporate earnings, but trade then will be range-bound as investors wait for more earnings reports and U.S. jobs data on Friday,” said Hiroichi Nishi, general manager of equity marketing at Nikko Cordial Securities.

“Moves in individual stocks will likely dominate today’s trade, and automakers will be in focus after the ADRs of Honda and Toyota clearly went their separate ways.”

The Obama administration stepped up the pressure on Toyota Motor on Wednesday to address a range of safety issues as investors bolted at signs of a deepening crisis for the world’s largest automaker.

Toyota will report third-quarter earnings later in the day.

Nikkei futures in Chicago closed at 10,465, up 0.4 percent from the Osaka close, pointing to a higher start.

The benchmark Nikkei is likely to move between 10,350 and 10,500 on Thursday, market players said. It rose 0.3 percent the previous day to 10,404.33.

Other Japanese companies set to report results later in the day include Sony Corp, Hitachi Ltd and Nikon Corp.


— Mitsubishi UFJ Financial Group

Mitsubishi UFJ Financial Group, Japan’s top bank, posted its biggest profit in seven quarters on Wednesday, buoyed by an improvement in its stock portfolio and kept its full-year forecast.

— Sharp Corp

Sharp reported a smaller-than-expected quarterly profit on Wednesday reflecting start-up costs at its new display panel plant but forecast tight LCD supply for 2010, raising hopes for a further earnings recovery.

— Takeda Pharmaceutical

Takeda Pharmaceutical, Japan’s biggest drugmaker, posted a 25.6 percent fall in quarterly profit, the lowest in three quarters, hit by a strong yen and sluggish U.S. sales, and it kept its full-year forecast.

— NEC Corp, Nippon Electric Glass Co

Japanese electronics conglomerate NEC said on Wednesday it would cut its stake in Nippon Electric Glass Co by selling about $851 million worth of shares in the glass maker.

— Nipro

Diabetes testing products maker Home Diagnostics Inc said it agreed to be acquired by Japanese medical devices company Nipro Corp for about $215 million.

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(Reporting by Aiko Hayashi; Editing by Edwina Gibbs)

Nikkei seen range-bound; Toyota, Honda in focus