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Nikkei edges up as Fast Retailing jumps; Yaskawa's earnings drag on machinery stocks

Published 07/12/2019, 02:38 PM
Updated 07/12/2019, 02:40 PM
Nikkei edges up as Fast Retailing jumps; Yaskawa's earnings drag on machinery stocks

* Fast Retailing lifts Nikkei, while Topix drops
* Yaskawa's earnings pull down Fanuc, Keyence
* Lawson jumps on strong quarterly results

By Ayai Tomisawa
TOKYO, July 12 (Reuters) - Japan's Nikkei edged higher in
choppy trade on Friday, helped by index heavyweight Fast
Retailing, but weak profits from some firms such as Yaskawa
Electric dragged on machinery stocks.
In afternoon trade, virtual currency exchange operator
Remixpoint Inc 3825.T started tumbling and ended 19% lower
after saying it had detected an improper leak of virtual
currency worth around 3.5 billion yen. The Nikkei share average .N225 ended 0.2% higher at
21,685.90 points. For the week, it fell 0.3%, its first such
drop in six weeks.
Fast Retailing 9983.T jumped 3.2% and contributed a hefty
79 points to the Nikkei. The operator of Uniqlo clothing stores
posted a smaller-than-expected quarterly profit, but said
full-year results were on track to reach a record high.
However, the broader Topix .TOPX shed 0.2% to 1,576.31.
Declining issues outnumbered advancing ones 1,356 to 703.
As Japanese markets will be closed for a holiday on Monday,
investors refrained from taking large positions, analysts said.
They said that the market will likely focus on quarterly
earnings results from U.S. and Japanese companies next week.
On Thursday, Yaskawa Electric 6506.T , a motion control
equipment maker with exposure in China, kicked off the earnings
season and reported a 58% fall in its operating profit for the
March-May quarter. That caused its stock price to fall 3.9% on
Friday. Yaskawa's results are monitored closely by investors as
the firm is seen as an indicator of Chinese demand.
"As the market has already priced in a U.S. rate cut this
month and there are few other major macro events in the near
future, the next focus is whether there are further U.S. rate
cuts for the rest of the year," said Takuya Takahashi, a
strategist at Daiwa Securities.
Takahashi said investors are keen for clues on business
sentiment and will look to company earnings for direction.
Yaskawa's weak results took a toll on other machinery
stocks. Fanuc Corp 6954.T dropped 2%, Keyence Corp 6861.T
shed 1.5% and SMC Corp 6273.T sank 2.4%.
Convenience store Lawson Inc 2651.T jumped 4.6% after its
first-quarter operating profit rose 12.4%, thanks to strong
sales from upscale supermarket chain Seijo Ishii Co which Lawson
had acquired.

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(Editing by Kim Coghill)

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