Nikkei Outlook

Is the Best Trade of 2013 Now Over?

Selling the Japanese yen has been one of the hottest trades of the year, but the currency's rebound against the U.S. dollar in the past three weeks has some questioning whether the short-yen trade has now run its course.

The yen was trading at about 98.65 to the dollar on Tuesday, off a two-month peak hit on Friday at around 95, but still more than 4.5% above a four-and-a-half year low hit last month.

" The short yen trade started to look very slippery in late May into early June when the yen started to rise rapidly," said Kathy Lien, managing director at BK Asset Management in a note. " This aggressive reversal, which happened within 2.5 weeks led many traders to wonder if the best trade of 2013 is now over."

Even with the yen's recovery, the currency is down 14% from where it started the year and analysts say some investors are using the yen's bounce as an opportunity to put on fresh short-positions, in other words a bet that the yen will head lower.

Many currency strategists are sticking to their call for the yen to weaken to 110 against the greenback this year.

Dennis Gartman, editor of The Gartman Letter, told CNBC's " Fast Money" on Monday that the yen was likely to go much lower, with a move to 150 " not that difficult an imaginative leap."

But the outlook may not be that clear cut, say analysts, as investors question the implications of " Abenomics." The radical economic policies of Japanese Prime Minister Shinzo Abe were expected to lead to outflows from Japan and underpin weakness in the yen that would in turn support a recovery in the Japanese economy, but that expectation has yet to become a reality.

Nikkei Tumbles After BOJ Meeting, Led By Futures Selling

TOKYO (NQN)--Tokyo stocks were losing further ground at the opening of the afternoon session Tuesday, with the Nikkei Stock Average briefly tumbling more than 200 points to the lower-13,300 level.

During the lunch break, the Bank of Japan said its policy board decided to continue its current monetary policy. An official at SMBC Nikko Securities Inc. said stock index futures are being sold intermittently, because the central bank decided not to extend the duration of the fixed-rate fund-supplying operation.

Some investors were expecting the central bank would extend the operation so as to stabilize long-term interest rates, the official said. Selling of stock index futures is also prompting investors to dump cash stocks.

Meanwhile, the dollar's rise to the 98 yen level from the 97 yen level helped the Nikkei average trim its losses.

The Tokyo Stock Exchange REIT index fell at one point, because the BOJ decided not to expand the purchase target for real estate investment trusts.

BOJ Decides To Maintain Current Monetary Easing Stance

TOKYO (Nikkei)--The Bank of Japan will maintain its quantitative and qualitative monetary easing policy of doubling Japan's monetary base within two years, the nine-member policy board decided on Tuesday.

Governor Haruhiko will meet the press in the afternoon to brief them on decisions made at the meeting and the progress of the monetary policy.

The BOJ stressed the need to implement the current monetary easing until it achieves a 2% inflation target and become stable.

The central bank has upgraded its overall economic assessment for six months straight due to improved exports and corporate production. In the May 21-22 meeting, it noted that " Japan's economy has started picking up."

The policy board shelved plans of extending the term of low-interest-rate funds to banks from up to one year to more than two years. The idea was floated to prevent long-term interest rates from rising, but some members expressed concerns that it may impede BOJ's monetary easing push for facilitating more investment in equities and lending.

Nikkei Ends Morning Flat Ahead of BOJ Policy Meeting

TOKYO (NQN)--Tokyo stocks ended the morning session nearly unchanged Tuesday, with the Nikkei Stock Average down 0.92 point, or 0.01%, at 13,513.28.

In reaction to the previous day's sharp rise, investors sold stock index futures to adjust their positions in the early going. The dollar's rise versus the yen sparked sporadic dip-buying, but the index seesawed throughout the morning near Monday's close.

13,399.91
-114.29 (-0.85%)
Open	13,504.77	(09:00)
High	13,584.31	(09:53)
Low	13,310.50	(12:37)

Nikkei Opens Lower Ahead of BOJ Policy Meeting

TOKYO (NQN)--Tokyo stocks opened lower Tuesday morning, with the Nikkei Stock Average falling 9 points, to 13,504 on opening.

In response to yesterday's surge, investors are selling stock index futures to correct their positions. Ahead of the Bank of Japan's early afternoon release of policy board meeting results, many investors are adopting a wait-and-see approach to see if the BOJ will take measures to stabilize interest rates.

Toyota Motor Corp. and other exporters are lower today after surging the previous day.

13,533.43
+19.23 (+0.14%)
Open	13,504.77	(09:00)
High	13,567.72	(09:27)
Low	13,419.36	(09:03)

Japan's economy continues turnaround

The Japanese economy grew at a quicker pace than originally reported in the first quarter, according to revisions released by the Cabinet Office on Monday.

The revisions show that GDP rose at a 4.1% annual pace in the first three months of the year. On a quarterly basis, Japan's GDP increased by 1.0%.

Japan's economy had been in a shallow recession as recently as last year, and the positive data should bolster hopes that the country's economic outlook is brightening. The growth could also provide a boost to Prime Minister Shinzo Abe's reform efforts -- a set of policies dubbed " Abenomics."

Abe had argued forcefully that the Bank of Japan needed to take aggressive action to stimulate Japan's flagging economy -- and made that a centerpiece of his election campaign last year.

...more...

Nikkei Surges 636 Points Logging Largest Gain Since '08

TOKYO (NQN)--Tokyo stocks surged Monday with the Nikkei Stock Average leaping 636.67 points, or 4.94%, to end the day at 13,514.20, the largest rebound since the benchmark index jumped 817.86 in Oct. 30, 2008. It was the first rebound in four trading days.

Last Friday's U.S. jobs data for May was mixed, easing concerns about a possible tapering of the Federal Reserve's QE. As a result, a broad range of issues were bought back.

Stocks rose across the board. A total of 1,670 issues on the first section of the Tokyo Stock Exchange advanced, the largest since Oct. 14, 2008.

The trading value on the first section of the TSE totaled about 2.57 trillion yen on a preliminary basis, falling below 3 trillion yen for the first time in about a month.

13,514.20
+636.67 (+4.94%)
Open	13,141.85	(09:00)
High	13,514.20	(15:28)
Low	13,141.37	(09:00)

Nikkei Rebounds 1st Time In 4 Days

TOKYO (NQN)--Tokyo stocks were in the black for the first time in four trading days Monday morning, with the Nikkei Stock Average rising 387.69 points, or 3.01%, to close the early session at 13,265.25.

At one point, the benchmark index extended its gains by 400 points to 13,340, a five-day high.

May U.S. jobs data released Friday showed mixed results, easing concerns that the Federal Reserve will scale back its QE, and prompting investors to buy back a broad range of stocks.

Tokyo stocks lost upward momentum after buying ran its course, as investors moved to capitalize on their gains.

Seiichi Miura, an investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co., said that with the Japanese currency strengthening beyond the 100 yen level against the dollar, overseas investors cannot be expected to continue only buying.

Ahead of Friday's special quotation fixing for the benchmark June contract for stock index futures, an official at a domestic brokerage said long-term investors are less prone to buy due to concern over the futures-led market moves.

13,296.78
+419.25 (+3.26%)
Open	13,141.85	(09:00)
High	13,340.94	(09:09)
Low	13,141.37	(09:00)

Japan Revises First Quarter Growth Figures Upwards

Japan has revised annualized gross GDP for January-to-March to 4.1% from a preliminary reading of 3.5%, official data showed on Monday.

A Reuters poll was expecting the growth figure to come in unchanged at 3.5%.

Quarter-on-quarter growth was revised upwards to 1%, compared to a preliminary reading of 0.9%. Economists polled by Reuters had expected no change from the initial reading.

According to Ed Rogers, CEO & CIO, Rogers Investment Advisors, the data add further evidence that the government's radical stimulus program is bearing fruit.

" Clearly, there's a lot more confidence back in this economy," said Rogers. " People are spending more money, that's the only way we would see this sort of GDP growth."

The data spurred a rally in Japanese stocks on Monday. The Nikkei jumped 3.5% at the open, after falling 6% last week, as markets questioned the effectiveness of Prime Minister Shinzo Abe's ambitious plans to end the economy's two-decade slump.

Still, some economists say it's too early to reach a verdict on Abe's economic policies, widely known as " Abenomics."

" We have a lot of expectations built in here but if we don't see the light of structural reforms, 'Abenomics' will make things worse: printing more money, and higher debt levels, so we really need the reforms to come through at the end of the day," said Frederic Neumann, MD & Co-Head of Asian Economics Research at HSBC.

Rogers added a note of caution over over an overly euphoric market. The Nikkei was up more than 75% between mid-November and May, before the market succumbed to profit taking, briefly falling into bear market territory late last week.

" One of the biggest risks we've seen so far is that expectations will dramatically outpace the restructuring," he said. " The restructuring that needs to take place will take place over a 6 month to 24 month period. Looking at results within a 1 to 2 month period will create lots of frustration."

Separate data out on Monday showed Japan's current account surplus doubling in April. This means the economy has logged a surplus for a third straight month, indicating that a moderate pickup in exports and huge income gains helped the nation's balance of payments.

The current account surplus stood at 750 billion yen ($7.70 billion), up 100.8% from a year earlier and much bigger than a median market forecast of a 320 billion yen surplus, according to data from the Ministry of Finance.

Nikkei Opens Higher On Easing Fears About Tapering Of U.S. QE

TOKYO (NQN)--Tokyo stocks opened higher for the first time in four trading days Monday, with the Nikkei Stock Average jumping 264 points at the market open and later rising to around 13,300.

The U.S. jobs data for May, released Friday, was mixed, easing concerns that the Federal Reserve will scale down its quantitative easing. As a result, Wall Street closed higher Friday, which is prompting investors to buy back a broad range of issues in Tokyo, with Toyota Motor Corp. and other blue chips rising across the board.

13,264.40
+386.87 (+3.00%)
Open	13,141.85	(09:00)
High	13,340.94	(09:09)
Low	13,141.37	(09:00)

Nikkei Ends At Fresh 2-Month Low On Dollar's Dive, U.S. Jobs Concern

TOKYO (Kyodo)--The Nikkei index ended at a fresh two-month low Friday in Tokyo on selling prompted by the dollar's dive amid concerns over U.S. labor market conditions.

12,877.53
-26.49 (-0.21%)
Open	12,706.41	(09:00)
High	13,106.20	(14:45)
Low	12,548.20	(13:20)

Japan's Neighbor Feels Brunt of 'Abenomics'

Prime Minister Shinzo Abe's policies to revive Japan's economy are proving to be problematic for neighboring South Korea, said the head of the country's financial regulator as a weak yen poses a threat to Korea's export competitiveness.

" We have two channels through which 'Abenomics' affects the Korean economy - trade and financial sector," Je-yoon Shin, chairman of South Korea's Financial Services Commission told CNBC Asia's " Squawk Box" on Friday. Exports account for around half of the country's GDP.

Given both South Korea and Japan economies rely on their export sectors for growth, depreciation in the yen which boosts the latter's export industry, presents a challenge for the former.

Despite the recent surge the yen has declined 16.6% against the U.S. dollar over the past six months driven by aggressive monetary easing in the world's third largest economy, while the won has depreciated just 2.7%.

Versus the won, the yen has depreciated around 22% over the past 12 months.

" There are many areas competing with Japanese products such as automobiles and ship building - they have [seen] some impact," Shin said.

For example, a weaker yen is making Japanese automakers more competitive and helping them expand their share in key markets such as the Middle East, according to Nomura, which could put South Korean carmakers at a disadvantage.

Small to medium sized businesses in Asia's fourth largest economy are also feeling a pinch, he added.

Another risk is that Japan's ultra-loose monetary policy encourages more investors to borrow in yen, a low-yielding currency, and invest in South Korean bonds, he said, which could drive the won to appreciate and lead to foreign exchange volatility.

" There [has been] a surge in our capital markets and bond markets - someday outflows of capital [is] another risk," he said, adding that the government is closely monitoring movements in the market.

Soros shorting yen, buying Japan stocks: report

By V. Phani Kumar

HONG KONG (MarketWatch) -- A hedge fund run by billionaire investor George Soros was back placing bets in Japan, shorting the yen and snapping up local stocks, according to a Dow Jones Newswires report Friday, citing a source close to the matter. Soros returned to the market following some signs of stability in the Japanese bond market, the source was cited as saying in the report. The person said that while the sharp recent fall in Japanese equities was a " surprise," the current level of stocks was " very attractive" as economic data and earnings were expected to pick up, Dow Jones reported.

The Nikkei Stock Average fell 2.1% in Friday's afternoon trading, and had entered a so-called bear market after dropping more than 20% from its 52-week peak reached on May 23. The U.S. dollar, meanwhile, was trading at ¥96.34, also sharply down from its May highs above ¥103.

Nikkei Opens Lower On Dlr's Decline

TOKYO (NQN)--Tokyo stocks opened lower Friday, with the Nikkei Stock Average sliding 197 points to begin the day at 12,706 before widening its losses to more than 200 points.

The benchmark index fell to the lowest point since April 4, when the Bank of Japan began the latest rounds of monetary easing.

The dollar weakened to the lower-97 yen level, prompting selling of blue-chip exporters.

Is 12,660.08 the bottom_^???

12,785.83
-118.19 (-0.92%)
Open	12,706.41	(09:00)
High	12,851.86	(09:29)
Low	12,660.08	(09:13)

Japanese Stocks Hit Bear Market

Japanese stocks have just crossed over to the dark-side. After a glorious " well, the market is up, so everything must be great" rally of 85% in six months, the Nikkei 225 is now down over 20% from its highs - signifying a 'bear market'. This is the largest 10-day plunge in 27 months as volume has exploded on the downside. We wonder how the herds representing these 5 charts are feeling now? At the same time, JPY has broken back below 99 against the USD (and AUDJPY is at 5 month lows) as the entire JPY-funded rampage comes undone - seems like the message from FX otion market was spot on.This is the lowest level in two months since Kuroda first spoke at the BoJ. Get that porta-otty ready, Abe... What next? Blame speculators? Short-sale ban? Shorting ban?

Initially sparked by a 5.0 earthquake - which was quickly saved - once the Japan's 30Y bond sale had passed (and ramped JGBs), equities started to fade rapidly... then the desperate defense of USDJPY 99 began (which sent JGBs lower)...

and then " it" happened... (just look at the two 250-300 point ramps that were tried to spark some momentum before it finally failed)...

From its highs at 16,020 on 5/22, the Nikkei 225 has now dropped 20% (12,815) - officially entering bear market territory. The low before it bounced was 12,810.

This is the first time near the 100DMA (green line) since the rally began...

leaving the Nikkei return (hedged for JPY) only 7.2% YTD... (and at three-month lows)...

It seems the BoJ has indeed lost control of the triumvirate of JPY, JGBs, and Stocks - as the latter now place each other in jeopardy at a higher and higher beta to JPY's swings.

Yen and Nikkei Traders – Who's Following Who? ....

Nikkei Falls Below 13,000 On Strong Yen

TOKYO (NQN)--Tokyo stocks moved back into the red after briefly recovering to around 13,100 Thursday afternoon, with the Nikkei Stock Average falling 110.85 points, or 0.85%, to end the day at 12,904.02. The index closed the day below 13,000 for the first time since April 5.

Kenichi Hirano at Tachibana Securities Co. said proprietary trading divisions of securities firms, which had been selling stock index futures in the morning, were buying back them in the afternoon in the view that the benchmark index will remain resilient. However, the yen's advance against the dollar induced selling toward the close.

Gainers included Tokyo Electron Ltd., Eisai Co., Chugai Pharmaceutical Co. and Shiseido Co. , while decliners included JGC Corp., Konami Corp., Seven & i Holdings Co. and Daikin Industries Ltd.

12,904.02
-110.85 (-0.85%)
Open	12,925.29	(09:00)
High	13,238.53	(10:15)
Low	12,862.02	(13:29)

Nikkei Opens Below 13,000 On Wall St Losses, Dlr's Fall

TOKYO (NQN)--Tokyo stocks opened lower Thursday, with the Nikkei Stock Average falling about 70 points to trade at the mid-12,900 level.

It is the first time since April 5 for the benchmark index to slip below 13,000.

The Dow Jones industrial average closed below 15,000 overnight for the first time in about a month. The dollar's decline to the 98 yen level is prompting selling of Toyota Motor Corp., Canon Inc. and other blue-chip exporters.

Investors also appear cautious ahead of Friday's release of U.S. jobs data for May. A chief strategist at Okasan Online Securities Co. said investors are moving to avoid risks, which is pushing down Japanese stocks that have been rising recently.

13,103.09
+88.22 (+0.68%)
Open	12,925.29	(09:00)
High	13,146.76	(09:47)
Low	12,896.10	(09:04)

Nikkei Hits 2-Month Low, Pushed Down By Futures

TOKYO (NQN)--Tokyo stocks fell sharply Wednesday, with the Nikkei Stock Average plunging 518.89 points, or 3.8%, to end the day at 13,014.87, its lowest point since April 5.

The loss was the third-largest this year.

After Prime Minister Shinzo Abe released the third element of the government's three-pronged growth strategy in the early afternoon, investors began selling Nikkei futures aggressively in the view that the strategy appeared very similar to what was reported previously.

Cash stocks were also dumped because they were targets of arbitrage unwinding. As a result, stocks that heavily influence the Nikkei average, including Fast Retailing Co. and Fanuc Corp., fell sharply, worsening investor sentiment.

The dollar and the euro weakened against the yen, prompting selling of carmakers and other blue-chip exporters.

The trading value on the first section of the Tokyo Stock Exchange totaled about 3.27 trillion yen on a preliminary basis.

13,014.87
-518.89 (-3.83%)
Open	13,566.75	(09:00)
High	13,711.42	(12:33)
Low	13,011.16	(14:39)

Yen. 99.56 all time low just now

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