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UPDATE1: Tokyo stocks mixed as yen weakens, MSCI index deletion weighs.

TOKYO, May 17 Kyodo


Tokyo stocks ended mixed Tuesday, with easing of the yen's strength prompting buying of export-related shares while news of the deletion of Japanese stocks from key global investment gauges weighed on the market.

The 225-issue Nikkei Stock Average advanced 8.72 points, or 0.09 percent, from Monday to 9,567.02. The broader Topix index of all First Section issues on The Tokyo Stock Exchange was down 0.70 point, or 0.08 percent, to 828.85.

The mining sector led gainers, followed by the securities and real estate sectors. Decliners included the electricity and gas, rubber products and fishery and forestry sectors.

After losing ground in the morning, the Nikkei index swung back to positive territory, ending its three-day losing streak, as the yen weakened against the U.S. dollar and the euro to lift exporter shares.

''Stocks trimmed earlier losses as the U.S. dollar advanced to the 81 yen range, and as there were some buybacks of relatively undervalued stocks,'' said Yumi Nishimura, senior market analyst at Daiwa Securities Co.

The euro also rose to around the mid-115 yen level from the lower 114 yen range toward the closing of the Tokyo stock market.

But the market remained under pressure as Morgan Stanley Capital International Inc. said Monday it would delete 20 Japanese stocks from the MSCI Global Standard Indices on May 31, triggering sharp falls among the shares.

The news had a negative impact on the market amid a dearth of other trading incentives as ''some investors overseas have been buying the shares because the stocks were listed on the indices,'' said Nishimura.

Hiroichi Nishi, equity division manager at SMBC Nikko Securities Inc. also said, ''The removal of the 20 shares from the index accelerated selling (in the morning).''

Exporters largely gained, with Sony rising 34 yen, or 1.5 percent, to 2,275 yen, and Canon advancing 10 yen, or 0.3 percent, to 3,725 yen.

Among the shares facing deletion, Hankyu Hanshin Holdings plunged 26 yen, or 7.4 percent, to 325 yen and Sapporo Holdings tumbled 10 yen, or 3.4 percent, to 297 yen.

Utility shares were largely down on uncertainties about Tokyo Electric Power Co.'s compensation scheme for the victims of the crisis at its crippled nuclear power plant.

Tokyo Electric Power plummeted 40 yen, or 9.5 percent, to 380 yen, while Chubu Electric Power dropped 78 yen, or 5.5 percent, to 1,339 yen.

On the First Section, declining stocks outnumbered advancing ones 910 to 613, with 145 others remaining unchanged.

Trading volume on the main section rose to 1,882.82 million shares from Monday's 1,801.47 million.
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Publication:Japan Weekly Monitor
Geographic Code:9JAPA
Date:May 23, 2011
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