Japan Stocks Advance on Weaker Yen; Advantest Falls on Forecast

Feb. 26 (Bloomberg) -- Japanese stocks rose for a second day, led by Honda Motor Corp., as the weakening local currency and a surge in oil prices lifted the earnings prospects for automakers and resource companies.

Honda, which gets more than half its profit from North America, added 4.2 percent. Japan Petroleum Exploration Co. leapt 3.4 percent after crude jumped to a one-month high. Advantest Corp., the world’s biggest maker of memory-chip testers, sank 4.4 percent after the company forecast a loss.

The Nikkei 225 Stock Average climbed 119.54, or 1.6 percent, to 7,580.76 as of 10:09 a.m. in Tokyo. The broader Topix index added 7.33, or 1 percent, to 752.95, after dipping as much as 0.1 percent. More than three stocks advanced for every two that fell on the Topix.

“The yen’s depreciation will continue to drive up exporters,” Mitsushige Akino, who oversees the equivalent of $615 million at Tokyo-based Ichiyoshi Investment Management Co., said in an interview with Bloomberg Television.

The Nikkei lost 16 percent this year through yesterday as recessions in the world’s largest economies battered company earnings. The gauge has advanced 4.2 percent since Oct. 27 when it closed at the lowest level in 26 years.

The Japanese currency weakened against the dollar to as much as 97.66 today from 97.21 at the close of stock trading in Tokyo yesterday. The yen earlier reached 97.78, a level not seen since Nov. 14. A weaker local currency boosts the value of repatriated overseas sales for Japanese companies.

Cars, Electronics

In New York, the Standard & Poor’s 500 Index slid 1.1 percent as the National Association of Realtors said purchases of previously owned homes dropped to the lowest annual rate since 1997. Economists had estimated resales would rise.

Honda climbed 4.2 percent to 2,495 yen, extending its advance to a third day. Nissan Motor Co., Japan’s third-largest automaker, added 3.3 percent to 310 yen. Mazda Motor Corp. advanced 3.1 percent to 132 yen.

Japan Petroleum, the nation’s No. 2 oil explorer, added 3.4 percent to 3,610 yen, while bigger competitor Inpex Corp. rose 2.6 percent to 669,000 yen. Crude oil for April delivery climbed for a third day reaching $42.60 a barrel as of 10:30 a.m. in Tokyo.

Advantest sank 4.4 percent to 1,364 yen. The company yesterday said its net loss will probably amount to 78 billion yen ($801 million) in the year to March 31 and that it plans to cut a quarter of its workforce by March. Yoshitsugu Yamamoto, an analyst for UBS AG, wrote in a report yesterday that cost cuts may not be enough for Advantest though a bottom for semiconductor demand is in sight.

Nikkei futures expiring in March added 1.3 percent to 7,580 in Osaka and Singapore.