Tokyo stocks up as Mitsubishi, Sharp soar

Tokyo shares closed higher Wednesday, with Mitsubishi Motors soaring on a report that Nissan chief Carlos Ghosn will become chairman while Sharp also rallied after flagging upbeat earnings. News that China's economy had stabilised in the third quarter also provided support. "China's economy is showing further signs of stabilising," said Michael McCarthy, chief market strategist at CMC Markets in Sydney. "Growth rates are at steady levels and is exactly in line with the state of policies to maintain growth between 6.5 percent and 7 percent," he told Bloomberg News.
The benchmark Nikkei 225 index gained 0.21 percent, or 35.30 points, to 16,998.91 while the Topix index of all first-section issues was up 0.05 percent, or 0.63 points, at 1,357.20. Mitsubishi Motors closed up 7.85 percent at 522 yen, having surged more than 10 percent at one point, following a report by the Nikkei business daily that Ghosn will take chairmanship.
In May Nissan threw Mitsubishi a lifeline as it announced plans to buy a one-third stake in the crisis-hit automaker for about $2.2 billion, forging an alliance that will challenge some of the world's biggest auto groups. The purchase came after Mitsubishi was hit by a mileage-cheating scandal that slammed the brakes on sales. Mitsubishi has asked its current chairman and president Osamu Masuko to stay on as president, the Nikkei said, citing unnamed sources.
Sharp's volatile stock jumped 10.63 percent to 156 yen as it said its full-year earnings were on track to "improve drastically". The upbeat comment came after the Nikkei business daily said Sharp - now under the control of Taiwan's Hon Hai Precision - is likely to return to an operating profit in the current fiscal year to March. Mitsubishi Heavy Industries inched 0.27 percent lower to 440.3 yen after it said Tuesday it plans to stop making large passenger ships due to a lack of profitability. But many exporters were lower as the dollar eased to 103.62 yen from 103.87 yen in New York. Sony fell 2.01 percent to 3,402 yen and Honda eased 1.06 percent to 3,056 yen. A stronger yen erodes the profitability of Japan's exporters and usually weighs on the Tokyo stock market.