TOKYO: Japanese stocks rebounded from the steepest loss in a month after the People’s Bank of China weakened the yuan by the least in three days and said it will control the pace of the currency’s depreciation.
Companies that rely on China for sales reversed two days of losses, with machinery maker Komatsu Ltd. climbing 1.1 percent. Utilities led gains in the Topix index, while banks fell. Hirose Electric Co. advanced 1.9 percent after a broker upgraded its rating on shares of the electronic-parts maker. SoftBank Group Corp. slumped 2.6 percent after one of its biggest investments, Alibaba Group Holdings Ltd., tumbled in U.S. trading as a weaker Chinese economy weighed on earnings.
The Topix added 0.1 percent to 1,667.95 at the close in Tokyo, reversing losses of as much as 0.9 percent after China’s central bank said adjustment spurred by how it determines the daily yuan reference rate is “basically already completed.” The Nikkei 225 Stock Average rose 1 percent to 20,595.55. Both measures slumped yesterday to the lowest closing levels since July 8. The yen strengthened for a third day against the yuan in offshore trading, bringing its gains since Tuesday to 3.3 percent.
“Devaluation of 4 to 5 percent won’t have any real effects on Japanese corporations,” said Mitsushige Akino, executive officer at Ichiyoshi Asset Management Co. in Tokyo, said by phone. “Actual impacts on the Japanese economy and corporations are limited.”
