Japan's Stock Futures Rise as U.S. Home Sales Unexpectedly Gain

Japan's Nikkei 225 Stock Average futures advanced after sales of existing homes in the U.S. unexpectedly rose, boosting confidence consumption in the biggest market for Japanese manufactures will weather an economic slowdown.

U.S.-traded receipts of Canon Inc., the world's biggest digital-camera maker, climbed 1.8 percent from the closing share price in Tokyo yesterday. Komatsu Ltd., the world's second- biggest maker of earthmoving equipment, advanced 1.5 percent, while Sony Corp. added 1.7 percent.

Investors' sentiment is improving, Mamoru Shimode, Tokyo-based chief equity strategist at Deutsche Securities Inc., said in an interview with Bloomberg Television. For stocks to continue rallying, the market needs more positive news from the macroeconomics side.

Nikkei 225 Stock Average futures expiring in June last traded at 12,685 in Chicago, 2.2 percent higher than the close of 12,410 in Osaka and Singapore yesterday. The Bank of New York Japan ADR Index, which tracks American depositary receipts of Japanese companies, added 2.9 percent.

Yesterday, the Topix index edged up 0.3 percent to 1,224.15, while the Nikkei was little changed at 12,480.09 in Tokyo. Almost the same number of stocks rose and fell on the Topix.

Purchases of existing homes rose 2.9 percent to an annual rate of 5.03 million in February, the National Association of Realtors said yesterday in Washington, surpassing an estimated 4.85 million. The Standard & Poor's 500 Index jumped 1.5 percent to the highest in almost a month.

Elsewhere, land prices in Japan rose for a second year in 2007, according to a government report released yesterday after the market shut. Prices increased 1.7 percent on average after climbing 0.4 percent a year earlier, as private funds and real- estate investment trusts snapped up properties in large cities.