Business

Nikkei seen recovering after fall, Apple suppliers in spotlight

January 24, 2013

TOKYO, Jan 24 — Japan’s Nikkei share average is expected to bounce slightly after three straight days of declines, with Japanese suppliers to the iPhone in focus after Apple announced disappointing sales figures for the smartphone overnight.

With an eye on the world, off this electronic board outside a brokerage in Tokyo, off to buy on the dip. — Reuters picWith an eye on the world, off this electronic board outside a brokerage in Tokyo, off to buy on the dip. — Reuters picMarket players said the Nikkei was likely to trade between 10,400 and 10,600 today after the benchmark fell 2.1 per cent to a three-week closing low of 10,486.99 yesterday, as investors took profits on a firmer yen.

“We should see a small rebound today because it’s fallen so much over the past few days... there will be people wanting to buy on the dip,” said Toshiyuki Kanayama, senior market analyst at Monex.

“But Japan’s trade data out this morning could affect the exchange rate, and Apple’s results were pretty bad.”

The world’s largest technology company shipped 47.8 million iPhones, lower than the roughly 50 million that Wall Street analysts had predicted, while its first-quarter revenue rose to US$54.5 billion (RM165.5 billion), below the average analyst estimate of US$54.73 billion, according to Thomson Reuters I/B/E/S.

Japanese part makers for the iPhone such as Sharp Corp, Murata Manufacturing Co Ltd and Foster Electric Co Ltd will come under scrutiny after Apple shares fell more than 10 per cent in extended trading.

Nikkei futures in Chicago closed at 10,510, up 0.4 per cent from the close in Osaka of 10,470.

The Nikkei has dropped 4.2 per cent from a 32-month high of  0,952.31 hit on January 15, the peak of a steep rally starting in mid-November, when then-incoming leader Shinzo Abe began calling for a weaker yen and aggressive monetary easing.

The Bank of Japan responded to pressure from Abe by announcing a 2 per cent inflation target at its policy meeting on Tuesday. It also committed to open-ended easing from 2014, a decision that disappointed some investors hoping for more immediate action.

Foreign brokers put in net buy orders of 15.4 million shares, their largest net purchase since January 15. — Reuters

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