4:30 PM Tokyo – Nikkei index in Tokyo traded surged 2.6% on the speculation that Prime Minister Shinzo Abe may cut corporate tax rate. The yen edged 0.7% lower. June core machinery orders fell less than expected 2.7%.
Stocks in Tokyo soared after the yen declined and on a report Prime Minister Shinzo Abe is looking to trim corporate tax rate.
A report in Nikkei newspaper suggested that prime minister is considering to lower corporate tax rate and evaluate the impact of lower interest rate and higher sales tax.
The report sparked a rally in market on the hopes that a lower corporate tax rate may support higher earnings. Also, weaker yen also supported market advance on the back of a rise in exporters.
The Nikkei 225 Stock Average climbed 347.57 or 2.6% to 13,867 and the Topix jumped 22.53 or 2% to 1,157.15.
The yen decreased 0.7% to 97.53 against one dollar.
On the economic front, June core machinery orders declined 2.7%, less than 5% decline many economists had feared. The data was released today by the Cabinet Office.
Stocks in Review
Toyota Motor Corp climbed 140 yen to 6,330 yen and Honda Motor Co. gained 70 yen to 3,795 yen. Nissan Motor Co Ltd increased 19 yen to 1,042 yen.
Sony climbed 35 yen to 1,967 yen and Canon Inc rose 60 yen to 3,190 yen. Nikon added 2 yen to 1,689 yen.
Sony Financial Holdings Inc jumped 2.8% to 1,703 after the insurance and financial-services provider lifted its dividend forecast to pay 30 yen per share from earlier guidance of 25 yen a share.
Fanuc Corp up 40 yen to 15,050 yen and Softbank Corp surged 380 yen or 6.3% to 6,370 yen.
Seven & I Holdings Co jumped 75 yen to 3,650 yen and Fast Retailing Co. soared 1,350 or 4.3% to 32,650 yen.
Mitsubishi UFJ Financial Group up 7 yen to 609 yen and Sumitomo Mitsui Financial Group climbed 90 yen to 4,540 yen.
Komatsu Ltd gained 1.9% to 2,315 yen after the Japan’s machinery orders fell less than 2.7% in June.
Mizuho Financial Group, Inc. rose 4 yen to 210 yen after the Japan based bank approached Australia and New Zealand Banking Group Ltd to buy 39.2% stake in Bank Pan Indonesia for $570 million.