Nikkei hits new 32-month high on Softbank, Yahoo; weaker yen supports
* Nikkei hits new 32-month high on weaker yen * Yahoo Japan jumps on share buyback, earnings and div forecast hikes * Canon, SMFG, Nintendo results in focus By Ayai Tomisawa TOKYO, Jan 30 (Reuters) - Japan's Nikkei share average rose to a new 32-month high on Wednesday, led by gains in Softbank Corp and Yahoo Japan Corp on optimistic profit expectations while earnings-related news dominated the market as investors awaited trading cues from the corporate sector. A weak yen also lifted the Nikkei briefly above the 11,000 mark, to hit a new 32-month high of 11,004.48 before ending up 1.1 percent at 10,990.77 by the midday break. Analysts said that investors bought dollar-yen after the Ministry of Finance released data on Wednesday showing that the country's trade deficit topped 1 trillion yen for the first 10 days of January. "The data pressured the yen, but for now, 11,000 seems to be the upside limit until investors confirm corporate earnings," said Hikaru Sato, a senior technical analyst at Daiwa Securities. "We need more catalysts to see the Nikkei comfortably rising further," he said. With quarterly earnings for the October-December period in the spotlight, analysts said that investors were focused on prospects for the fiscal year ending March 2014 as they start scrutinising companies' financial details such as how far a recently weak yen can push up bottom lines. Softbank rose 1.5 percent, being the five most traded stocks on the main board by turnover, after Dish Network Corp decided against filing to block Sprint Nextel Corp's proposed deal with Softbank, at least for now. A Nikkei report that the mobile phone carrier likely generated a group operating profit of about 590 billion yen ($6.51 billion) for nine months ended December is serving as a tailwind, traders said. "Before, investors were like, 'just buy bellwether Japan stocks', but now they are being selective," said Hiromichi Tamura, chief strategist at Nomura Securities. "Many of them still want to add more Japanese shares to their portfolios, and companies that are reporting strong results and forecasts are in focus." Yahoo Japan jumped as much as 21.4 percent to a four-year high of 38,600 yen after it said it planned to buy back up to 20 billion yen ($221 million) of its own shares, or 1.4 percent of its issued stock. The company lifted its full-year operating profit forecast to a range of 179.30 billion yen to 181.70 billion yen from a previous estimate of between 173.30 billion and 177.00 billion yen, citing stronger advertising sales. It also raised its annual dividend forecast to a range of 382-387 yen per share from a previous forecast of 370-378 yen. "Investors have shifted their focus to prospects for the full-year (ending this March) as well as next year (through March 2014)," said Hiroichi Nishi, an assistant general manager of equity investment at SMBC Nikko Securities. Komatsu Ltd was up 1.9 percent after falling as much as 3.8 percent as the world's second-largest maker of construction machinery cut its annual operating profit forecast for a second time this financial year as demand for mining equipment in Indonesia fell. "Even if some earnings disappoint the market, the impact on the overall market should be limited because investors will probably buy shares on dips as fundamental sentiment is being supported by 'Abenomics'," Nishi said. Companies reporting results later on Wednesday include Nintendo Co, Sumitomo Mitsui Financial Group and Canon Inc. Investors have been piling into the Japanese market in the hope that "Abenomics", Prime Minister Shinzo Abe's brand of economic policy involving aggressive monetary easing and a weaker yen, will boost such stocks as exporters and financials. The Nikkei has risen about 27 percent since mid-November, when Abe, then a candidate for leader of the opposition and now prime minister, began calling for aggressive monetary easing. The broader Topix gained 0.9 percent to 928.75 by the midday break.
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