Japan's Nikkei 225 Drops for Second Day on Yen's Advance; Advantest Falls

Japan’s Nikkei 225 Stock Average fell for a second day as the dollar weakened yesterday to a six- week low against the yen, damping the outlook for exports.

Advantest Corp., the world’s biggest maker of chip-testing equipment, lost 0.4 percent. Honda Motor Co., Japan’s second- largest carmaker which gets more than 80 percent of its revenue abroad, sank 0.5 percent. Inpex Corp., Japan’s No. 1 oil explorer, climbed 0.8 percent.

In Japan, “stocks, especially exporters, will head lower because of the yen’s appreciation,” said Hiroichi Nishi, an equities manager in Tokyo at Nikko Cordial Securities Inc. “Money flows into risk assets, including commodities, has continued, so gains in commodities should support the market.”

The Nikkei 225 Stock Average slid 0.1 percent to 10,287.44 as of 9:21 a.m. in Tokyo. The broader Topix index was little changed at 902.58. About six stocks gained for five that fell.

Futures on the Standard & Poor’s 500 Index slid 0.1 percent today. The index rose 0.1 percent yesterday in New York as commodity producers gained on higher prices for energy and metals amid signs of growing global demand.

The New York-based Conference Board said yesterday that its index of U.S. consumer confidence decreased to 52.5 in December, lower than the most pessimistic forecast of economists surveyed by Bloomberg News. Separate reports showed a gain in U.S. retail sales and a drop in property values.

Yen Gains

The yen appreciated to 81.82 against the dollar yesterday in New York, the strongest level in intraday trading since Nov. 12. Against the euro, Japan’s currency climbed to 107.62, the highest since Sept. 14. A stronger yen reduces the value of overseas income at Japanese companies when repatriated.

The Topix lost 0.5 percent this year through yesterday, compared with gains of 13 percent by the S&P 500 and 10 percent by the Stoxx Europe 600 Index. Stocks in the Japanese benchmark are valued at 15.7 times estimated earnings on average, compared with 14.8 times for the S&P 500 and 12.4 times for the Stoxx 600.

Crude oil for February delivery climbed 0.5 percent to $91.46 a barrel in New York yesterday. Copper futures increased 1.1 percent in New York to a record for a second straight day. Gold futures gained 1.6 percent in New York yesterday, the biggest gain for a most-active contract since Nov. 4.