4:30 PM Tokyo – Nikkei average in Tokyo dropped more than 2% taking the index in the negative zone year to date. Nikkei has plunges nearly 18% from the high in February. Japan said economy in the second quarter shrank less than expected.
Stocks in Tokyo traded lower and the benchmark Nikkei average dropped in the negative zone for the year to date after China reported weaker than expected economic data.
On the domestic economic front, Japan said economy contracted less than estimated largely on the revision in the inventory data. The higher level inventories in the quarter suggest additional weakness in the third quarter.
The gross domestic product was upwardly revised for the second-quarter to decline 0.3%, less than the previously estimated 0.4% fall in July, the Cabinet Office said.
For the year, GDP contracted 1.2% and declined less than the previous estimate of 1.6% decline.
The current account surplus in July soared to 1.81 trillion yen from 55.8 billion yen surplus in June and the trade deficit rose to 108 billion yen from 102.6 billion yen in the previous month, the Ministry of Finance said.
Total export in July jumped 4.6% to 6.54 trillion yen compared to 6.46 trillion yen in June while imports declined 6.5% to 6.65 trillion yen from 6.35 trillion yen in the previous month.
Total bank lending in August jumped 2.7% to 490.28 trillion yen and unchanged from the July, the Bank of Japan said.
The Nikkei 225 Stock Average dropped 433.39 or 2.4% to 17,427.08 and the broader Topix index slumped 28.94 to 1,416.71.
The yen strengthened to 119.87 against a dollar.
Stocks in Review
FamilyMart Co Ltd
fell 1.2% to 5,110 yen after the convenience store operator agreed to acquire smaller domestic rival Cocostore Corp with a store network of 12,000 retail stores for about 13 billion yen.
Ms&Ad Insurance Group Holding Inc
dropped 2.6% to 3,568 yen after the insurance company’s subsidiary Mitsui Sumitomo Insurance agreed to buy the U.K-based non-life insurance and reinsurance underwriter Amlin Plc for 670 pence a share.
Mitsui Sumitomo agreed to pay 635 billion yen or £3.47 billion or $5.34 billion.
The transaction is expects to close in the first-quarter of fiscal 2016.
Separately, the insurer said total premium earned in August jumped 7.6% to 215.30 billion yen from a year ago month. Premium in voluntary automobile business increased 3.8% to 98.93 billion yen and premium earned in fire segment soared 23% to 40.09 billion yen.
Minebea Co Ltd
decreased 2.6% to 1,381 yen after the ball bearings maker agreed to acquire remaining 65% stake in Switzerland-based Paradox Engineering SA with an estimated net sales to achieve of about 1 trillion yen and operating profit of about 100 billion yen in next year.
slumped 2.5% to 7,510 yen after the construction company said net sales in the first-quarter ending in July jumped 7.2% from a year ago to 67.51 billion yen from 62.99 billion yen.
Net income in the quarter surged 74.4% to 2.13 billion yen compared to 1.22 billion yen and earnings per share soared to 158.19 yen from 90.66 yen in the same period a year ago.
For the first-half, the company forecasted net sales to increase 6.3% to 133.07 billion yen and net income to jump 16.6% to 1.79 billion yen.
The company estimated net sales for the year ending in April to soar 8.2% to 287.06 billion yen and net income to surge 14.7% to 7.13 billion yen.