Mitsubishi surge bolsters Nikkei

MOTOR stocks drove

Some glimmers of light in Japan's consumer sector boosted retail shares, and the Nikkei 225 Average scored a modest gain of 17.40 points to 11,352.89.

There was nothing modest about the 15% surge in the shares of Mitsubishi Motors as DaimlerChrysler revealed plans to take a majority stake in the group. It was reported in Germany at the weekend that the Western giant, which already owns 37% of Mitsubishi, has ambitions to take full control by 2003.

Tyre maker Bridgestone gained more than 3% after saying it had won a major contract to supply General Motors, which is its first real break back into the US market since the debacle over its bursting tyres on Ford Explorers in 2000 hammered sales. Retail shares jumped after investors gave an enthusiastic response to a near-40% rise in profits of Japan's third-largest retailer Aeon, which rose almost 3%.

Other retailers followed the moves as analysts began to rework earnings estimates, and latest wholesale prices data steadied. The data were unchanged in March after rising in February, and while oil played a part, the latest figures were given a guardedly optimistic welcome by analysts. However, year on year, the index was still down 1.3%, showing that the deflationary cycle would not end soon.

Japan Telecom jumped almost 9% on data showing that its J-Phone offshoot, operated along with British mobile phones leader Vodafone, is now the second-largest wireless network.

Caution ahead of a wave of corporate reports from the US this week, which will provide crucial indication of the earnings prospects, kept trading quiet in other markets.

Hong Kong's Hang Seng sagged 107.7 to 10723.7 as investors shunned blue-chips and most action there was concentrated in bargain-hunting among second-liners.

Reports that telecoms giant Pacific Century Cyberworks has recruited a former executive from Lucent Technologies of the US to boost its flagging performance and reputation failed to lift the shares, which outpaced the market slide with a 1.11% fall.

The formal announcement of the management change is expected later today, and could lead to Michael J Butcher eventually taking over from chief executive Richard Li, under whose stewardship the company's stock has tumbled more than 90%.

The recent high-flying markets of South Korea and Taiwan showed signs of fatigue as shares failed to hold on to early gains. While mergers among stockbrokers boosted South Korea's financial sector, profit-taking elsewhere left the Kospi narrowly down by 0.58 to

918.01. Initial gains in technology stocks petered out in Taiwan, leaving the Weighted Average off 87.57 at 6207.09.

Light trading in Sydney left stocks virtually static, with the All Ordinaries closing unchanged at 3340.2. An optimistic assessment of the Malaysian economy by the Moody's rating agency saw the Kuala Lumpur Composite index up 8.03 to 769.45.

Singapore's Straits Times lost 7.2 to 1772.7., while the Jakarta Composite put on 1.74 to 510.73. Thailand's markets were closed.

Prices and indices in this report are from various sources and calculated at different times and may not always match those listed elsewhere on the site.