May 19, 2014 11:50 am JST

Tokyo stocks almost flat, strong yen offsets Wall St. gain

TOKYO (Kyodo) -- Tokyo stocks ended the morning session almost flat Monday, as selling triggered by the yen's continued strength offset earlier gains spurred by pre-weekend rises in U.S shares and Japan's solid machinery data for March.

     The 225-issue Nikkei Stock Average inched up 10.15 points, or 0.07 percent, from Friday to 14,106.74. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 1.17 points, or 0.10 percent, at 1,157.90.

     In early trading, stocks rebounded after sharp falls on Friday as sentiment was underpinned by firmer U.S. shares following rosy U.S. housing starts for April, brokers said.

     Ayako Terada at Nomura Securities Co.'s investment research department said record growth in Japan's core private-sector machinery orders in March also added to the positive mood.

     However, stocks soon lost steam and hovered near Friday's closing level.
"Since the yen is remaining firm versus the U.S. dollar at the mid-101 yen level, the upside is likely to be capped for the day," Terada said.

     With a series of corporate earnings announcements by major Japanese firms having wound down, investors will shift focus to Japan's macroeconomic data and overseas market conditions, brokers said.

     For this week, market participants are keeping close tabs on the outcome of the Bank of Japan's two-day policy meeting from Tuesday as well as the HSBC China manufacturing purchasing managers' index for April due out Thursday, they said.
Gainers were led by paper, retail and land transport companies while decliners included consumer finance, steel and rubber issues.

     Among retail shares, Aeon climbed 16 yen, or 1.3 percent, to 1,208 yen following news reports that the company will integrate three grocery store chains under a joint venture to bolster the sales base in the Tokyo metropolitan area.

     Export-oriented companies faced selling pressure with the yen's strength raising speculation about their weak overseas performance. Toyota Motor sagged 33 yen, or 0.6 percent, to 5,489 yen and Nissan Motor slipped 3 yen, or 0.3 percent, to 891 yen.

     Engineering firm JGC dropped 61 yen, or 2.1 percent, to 2,855 yen after the company said last week its group net profit for the business year through March 2015 is likely to fall 11 percent from the previous year.

     On the First Section, advancing issues outnumbered declining ones 852 to 791, while 164 finished the morning unchanged.