Asian Market Commentary
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Japan Market Surges; Nikkei Near 7-month High

The Japanese stock market opened on a buoyant note on Monday with investors going on a buying spree in early trades following the yen's decline against the U.S. dollar and the euro as well. A rate cut by the Chinese central bank, easing worries about the eurozone economy amid hopes of a solution to Greece's debt woes, and expectations of improved earnings for exporters too appear to be contributing to the surge.

The benchmark Nikkei 225 index, which rose to 9,549.3, a near 7-month high, after opening nearly 120 points up at 9,502.8, is currently trading at 9,508, up 123.8 points or 1.3 percent over its previous close.

Financial, automobile, steel, non-ferrous metals, electric power and precision instruments are trading notably higher. Stocks from construction, services and retail sections are trading mixed.

Kawasaki Heavy Industries, JFE Holdings, Kobe Steel, Nippon Steel, Ebara Corp, Mitsubishi Corp, Bridgestone, Mitsui Chemicals, Nisshin Steel and Sumitomo Metal Industries are up 4 to 6 percent.

Inpex Corp shares are trading nearly 4 percent up. Mitsui OSK Lines, Hitachi Construction Machinery, Nippon Yusen, Daikin Industries, Dai-ichi Life, Sumitomo Electric and Tokyo Electric Power are all trading higher by over 3 percent.

Pacific Metal, Konica Minolta, Panasonic Corp, Oki Electric, Yokohama Rubber, Fujitsu and Japan Tobacco are also up with strong gains.

Among bank stocks, Aozora Bank is gaining more then 3 percent. Mitsubishi UFJ Financial, Mizuho Financial, Shinsei Bank, SMFG, Chiba Bank and Bank of Yokohama are all up 1 to 1.5 percent, while Shizuoka Bank is trading 0.5 percent higher.

In the automobile space, Isuzu Motors, Hino Motor and Mazda Motor are up 2 to 2.5 percent, while Honda Motor, Nissan Motor, Suzuki Motor, Toyota Motor and Mitsubishi Motor are trading higher by 1.5 to 1.8 percent.

Among the losers, Sumitomo Osaka, Shimizu Corp, Taisei Corp, Obayashi, Advantest, Tokyo Dome and Mitsubishi Paper are down 1 to 1.6 percent.

On the economic front, Japan saw a merchandise trade deficit of 1.475 trillion yen in January, the Ministry of Finance said on Monday. That was even worse than forecasts for a shortfall of 1.456 trillion yen following the downwardly revised deficit of 205.6 billion yen in December.

Imports jumped 9.8 percent on year versus forecasts for an increase of 9.6 percent after rising 8.1 percent in the previous month. Exports plunged an annual 9.3 percent but actually beat forecasts for a contraction of 9.4 percent after plummeting 8.0 percent a month earlier.

The adjusted trade balance showed a deficit of 612.8 billion yen, beating expectations for a shortfall of 847.8 billion yen following the downwardly revised deficit of 569.7 billion yen in December.

In the currency market, the U.S. dollar traded in the upper 79 yen level in early trades in Tokyo. The yen is currently trading at 79.56 to the U.S. dollar.

Among other markets in the Asia-Pacific region, Australia, Shanghai, Hong Kong, New Zealand and Singapore are up with strong gains. Malaysia, South Korea and Taiwan are also trading notably higher. Markets across the region ended on a firm note on Friday.

On Wall Street, stocks turned in a relatively lackluster performance on Friday after showing a strong upward move in the previous session. The choppy trading came as traders seemed reluctant to make any significant moves going into the long weekend.

The major averages eventually ended the session mixed, with the tech-heavy Nasdaq posting a modest loss. While the Nasdaq ended down 8.1 points or 0.3 percent at 2,951.8, the Dow climbed 45.8 points or 0.4 percent to 12,989.9 and the S&P 500 edged up 3.2 points or 0.2 percent to 1,361.2.

Major European markets ended higher on Friday. While the U.K.'s FTSE 100 index ended the day up by 0.3 percent, the French CAC 40 index and the German DAX index both surged 1.4 percent.

U.S. Crude oil futures closed at a nine-month high on Friday, on some upbeat U.S. economic data and the possibility of a resolution to the Greek sovereign debt problem. Light Sweet Crude Oil futures for March delivery gained $0.93 or 0.9 percent to settle at $103.24 a barrel on the New York Mercantile Exchange.

by RTT Staff Writer

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