Japan’s Nikkei share average rose on Thursday morning on domestic earnings optimism after electric motor maker Nidec Corp reported strong quarterly results.
Shares of Nidec jumped 10 percent after it posted a 24.1 percent rise in operating profit to 31 billion yen ($249.92 million) for April-June, a record quarterly profit.
Bucking the strength, Eisai Co fell nearly 10 percent and was the third most traded stock by turnover after news of disappointing research data for partner Biogen Inc’s experimental Alzheimer’s drug.
The Nikkei share average gained 0.3 percent to 20,661.19 in midmorning trade. With worries about international risks such as volatility in China shares receding, investors started to shift their focus to domestic catalysts, traders said.
“Expectations for strong earnings have always been there, and people finally can focus on them,” said Isao Kubo, equity strategist at Nissay Asset Management, adding that the Japanese market will likely gradually rise back to its 18-1/2-year high of 20,952.71 hit in June.
Stocks related to rising inbound tourism outperformed after the Japan National Tourism Organization said on Wednesday a record number of foreigners travelled to Japan during the first half of this year. The number jumped 46 percent on year to 9.14 million, it said.
Department store stocks climbed, with Isetan Mitsukoshi Holdings rising 2.1 percent and Takashimaya Co 2.5 percent. Disney Resort operator Oriental Land Co rose 2.3 percent.
Caterpillar Inc’s weak sales data took a toll on Japanese construction machinery makers’ shares.
Ahead of its scheduled earnings report, Caterpillar said retail sales statistics of machines were down by 2 percent to 50 percent in all regions for the three-month rolling period ended June. Komatsu Ltd fell 2.8 percent and Hitachi Construction Machinery Co dropped 1.8 percent.
The broader Topix gained 0.3 percent to 1,659.48 and the JPX-Nikkei Index 400 advanced 0.2 percent to 14,973.39. ($1 = 124.0400 yen)