Thursday May 15, 02:44 AM
Tokyo shares firmer on Wall Street's rise after milder inflation - UPDATE
TOKYO (Thomson Financial) - Japanese shares were firmer in early trade on Thursday as investors took their lead from Wall Street's overnight gains following a milder-than-expected increase in consumer prices and a drop in crude oil prices.
A weaker yen and exporter Sony Corp (Munich: 853687 - news) .'s upbeat earnings outlook also supported sentiment.
At 9:38 a.m. (0038 GMT), the Nikkei (news) 225 Stock Average was up 103.98 points or 0.7 percent at 14,222.53. It opened up 48.47 points or 0.3 percent.
The broader Topix rose 18.19 points or 1.3 percent to 1,391.23.
Overnight, the Dow Jones industrial Average rose 66.20 points or 0.5 percent to 12,898.38.
The Labor Department said on Wednesday that U.S. consumer prices increased 0.2 percent in April after rising 0.3 percent in March, while the core consumer price index rose 0.1 percent, below the market consensus of 0.2 percent.
Light (LIGT3.SA - news) , sweet crude oil for June delivery fell $1.58 to settle at $124.22 a barrel on the New York Mercantile Exchange.
'But the (stock market's) upside may be top heavy. While stocks had already risen considerably, high oil prices are expected to continue to weigh on the market,' said Yoshikiyo Shimamine, chief economist at Dai-Ichi Life Research Institute.
'In addition, investors may be concerned with weak forecasts for machinery orders,' Shimamine said.
Before opening bell, the Cabinet Office announced that Japan's core private sector machinery orders fell by a seasonally-adjusted 8.3 percent in March from February, suggesting weakening corporate appetite for new investments. Core (Berlin: LJ1.BE - news) machinery orders are expected to fall 10.3 percent in the three months to June from the previous quarter.
Sony led the early gainers. The company forecast 20 percent growth in operating profit for the year to March 2009, even after posting its second-best operating income in the fiscal year just ended.
The stock surged 8.7 percent to 5,270 yen.
Steel and shipping issues also paced the market, with Nippon Steel (Berlin: NPS.BE - news) jumping 4.8 percent to 628 yen and Mitsui Nippon Yusen rising 3.3 percent to 1,100 yen.
NEC Electronics Corp (Stuttgart: 812960 - news) . rallied 8.3 percent to 2,355 yen after the company reported the group's first operating profit in three years, attributing the improvement in its year-to-March performance to heavy cost-cutting and restructuring efforts. Operating profit reached 5 billion yen, reversing a 28.6 billion yen loss posted a year earlier.
($1 = 105.24 yen)
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