Japan Hot Stocks-Dentsu, JX Holdings, Freund, Marubeni, automakers, Renesas
TOKYO, Oct 4 (Reuters) - The Nikkei average advanced 1.1 percent and the broader TOPIX climbed 1.4 percent on Thursday.
The following stocks were on the move. **DENTSU INC FALLS, SMBC NIKKO CUTS RATING**
Dentsu fell 2.4 percent to 1,858 yen, marking its seventh straight losing session and striking a three-year low, after SMBC Nikko Securities downgraded Japan's biggest advertising company to 'underperform' from 'neutral', lowered its target price and cut earning forecasts.
SMBC Nikko cut its forecast for Dentsu's operating profit for the year ending March 2013 by 3 percent to 57 billion yen, below the company guidance of 60 billion yen ($764 million).
"Our downward revisions owe primarily to a slowdown in domestic advertising demand, which was solid in 1Q but has recently taken a turn for the worse. In addition, sales at the parent have continued to trend below the overall domestic advertising market since the start of 2012. There are no signs of a recovery in market share," said SMBC Nikko Securities analysts Eiji Machida and Koji Kamichika in a note.
**JX HOLDINGS FALLS, CUTS COPPER PRICE**
JX Holdings Inc fell 1.6 percent to 434 yen after a source said Pan Pacific Copper Co, its joint venture with Mitsui Mining and Smelting , has cut its term premium for copper by 15 percent from last year to $85 per tonne for Chinese clients' 2013 shipments.
The cut is at the high end of expectations, reflecting the eagerness of the Japanese firm to sell the copper, with one Chinese executive saying that firms were reluctant to buy from Japan due to a territorial dispute raging between the countries.
**FREUND CORP JUMPS, RAISES OPS ESTIMATE**
Freund Corp rose 4.6 percent to a three-week high of 925 yen after the chemical maker raised its operating profit estimate by 48 percent to 890 million yen ($11.3 million) for the six months ended Aug. 31 as sales from large overseas contracts came in stronger than expected.
**MARUBENI RISES AFTER BARCLAYS LIFTS PRICE TARGET**
Trading house Marubeni Corp gained 1.4 percent to 498 yen after Barclays Securities lifted its price target on the stock to 700 yen from 650, saying the company had lower exposure to resources businesses than its peers.
"Our top pick is Marubeni, as fundamentals are benefiting from a comparatively low dependence on steel raw materials and a high profit contribution from non-resources businesses and from likely growth in non-resource profits in FY3/14 (fiscal year ending March 2014) driven by acquisition of U.S. grain merchant Gavilon," it said in a note.
The brokerage cut its price target on Mitsubishi Corp
to 1,860 yen from 2,000, Mitsui & Co to 1,320 yen from 1,350, Sumitomo Corp to 1,190 yen from 1,230, and Itochu Corp to 1,070 yen from 1,100.
Mitsubishi dipped 0.2 percent to 1,377 yen, Mitsui & Co fell 0.9 percent to 1,072 yen and Sumitomo Corp slipped 0.3 percent to 1,038 yen, while Itochu Corp was flat at 767 yen.
"Profit forecasts and share prices for the Japan trading companies industry have declined on concern over the Chinese economy and weakness in steel raw material prices," Barclays Securities said.
"While steel raw material prices are showing signs of a bottom, we see no real prospects for a sustained recovery in Chinese demand for the time being and expect this to keep share prices from rebounding in earnest."
**AUTOMAKERS REBOUND AS INVESTORS FACTOR IN BAD NEWS**
Japan's big three automakers, Toyota Motor Corp , Nissan Motor Co and Honda Motor Co , were in demand as investors factored in concerns over sputtering global growth and sluggish demand from China amid rising anti-Japanese sentiment over a territorial dispute.
A weaker yen, which was quoted at 78.64 to the dollar, also boosted the appeal of carmakers and other exporters.
Toyota Motor rose 3 percent to 3,095 yen and was the most-traded stock on the main board by turnover after losing 7.7 percent between Sept. 20 and Oct. 3, while Honda Motor gained 3 percent to 2,430 yen.
Nissan Motor, the second-most traded stock, climbed 4.3 percent to 674 yen.
"Although the Big Three all strike us as undervalued from a medium-term perspective, our preference over the next three months is for Honda Motor, followed by Toyota Motor, followed by Nissan Motor," Nomura Securities said in a note.
"Earnings forecasts at Nissan Motor are subject to downside risk, but investors look to have already priced in bad news, and might reappraise the stock following the release of H1 results."
**RENESAS UP AS MORE EMPLOYEES TAKE UP REDUNDANCY SCHEME**
Struggling chipmaker Renesas Electronics Corp jumped 7.8 percent to 303 yen on short-squeeze after it said a larger-than-expected number of employees volunteered for its redundancy scheme.
About 7,500 employees volunteered to resign with compensation, the company said after the market hours on Wednesday. The firm had expected about 5,000 workers to opt for the scheme.
The implementation of the scheme will reduce cost by 54 billion yen per year, the company said.
Short-selling interest in Renesas remained high, with 89.93 percent of its stock available to be borrowed already out on loan as of Oct. 2, down from 92.04 percent on Sept. 7, according to data provider Markit.
**NIHON KOHDEN HIS 2-MTH HIGH, J.P. MORGAN LIFTS PRICE TARGET**
Nihon Kohden Corp gained 4.4 percent to 2,744 yen after trading as high as 2,770 yen to a two-month high after J.P. Morgan raised its price target on the medical equipment maker to 4,100 yen from 3,700, saying it expected the firm to overshoot its first-half earnings guidance on strong Japanese sales.
"It appears that a strong domestic showing is offsetting a shortfall on aggressive overseas sales targets. If this year is typical, deliveries of rival goods to public hospitals will increase in 2H," J.P. Morgan said in a note.
"Yet, even assuming that the cost ratio held essentially unchanged year-on-year in the July-September quarter, Nihon Kohden should still have overshot its 5 billion yen 1H operating profit target by at least 10 percent."
The brokerage raised its operating profit forecast for the year ending March 2013 by 8 percent to 14.3 billion yen, and maintained its 'overweight' rating.
**PC-RELATED COMPANIES HURT BY HP OUTLOOK WARNING**
Personal computer-related companies suffered after Hewlett-Packard Co warned of an unexpectedly steep fall in earnings in 2013, with revenue set to fall in every business division except software.
Nidec Corp dropped 3.1 percent to a more than three-year low at 5,350 yen. The maker of precision motors was also weighed down by J.P. Morgan's downgrade to 'neutral' from 'overweight'.
TDK Corp lost 2.5 percent to 2,791 yen, also hurt by a price target cut to 3,200 yen from 3,640 by J.P. Morgan. Ibiden Co Ltd shed 4.1 percent to 1,011 yen, hitting a nine-year low.
On Nidec, J.P. Morgan said: "We think the current share price reflects the company's dominant growth potential within the sector, and thus see only limited upside amid a forecast for no improvement in PC sentiment."
**IZUMI HITS NEARLY 5-YEAR HIGH ON SHARE BUYBACK PLAN**
Izumi Co Ltd jumped 17.7 percent to 1,926 yen, its highest level since December 2007, after the supermarket operator said it would spend up to 8 billion yen to buy back up to 4 million of its own shares, or 5.1 percent of its issuing shares, between Oct. 4 and Dec. 28.
**TOMY UP ON POKEMON GLOBAL MARKETING RIGHT**
Tomy Co Ltd climbed 6.4 percent to 434 yen after the Nikkei newspaper said the toy maker has acquired the right to develop and market Pokemon character goods globally in an aim to expand its sales.
The business daily said Tomy would take over Pokemon operations in Europe and the United States from Bandai Co, a unit of Namco Bandai Holdings Inc , and local firms.
Namco Bandai slipped 2.1 percent to 1,274 yen.
**NIKON HITS 3-WEEK LOW ON REPORT OF WEAKER H1 EARNINGS**
Nikon Corp sagged 4.5 percent to a three-week low of 2,017 yen after the Nikkei business daily said the camera maker was likely to post an operating profit for the first half ended in September of around 35 billion yen ($446 million), below a market consensus estimate of 40 billion yen.
The newspaper said the 43 percent drop in first-half operating profit was due to weak sales of chipmaking devices and a strong yen.
Nikon is due to report its interim earnings later this month.
**CANON FALLS AFTER HEWLETT-PACKARD WARNS ON 2013 EARNINGS**
Canon Inc shed 3 percent to 2,478 yen after its client Hewlett-Packard Co warned of an unexpectedly steep earnings slide in 2013, with revenue set to fall in every business division except software.
A trader said 20 percent of Canon's sales go to Hewlett-Packard.
Canon was the most traded stock by turnover on the main board, while rival firm Ricoh Co Ltd dropped 2.7 percent to 698 yen.
0010 GMT ($1 = 78.5300 Japanese yen) ($1 = 78.5300 Japanese yen)
(Reporting by Dominic Lau; Editing by Edmund Klamann, Prateek Chatterjee, G. Ram Mohan and Jijo Jacob)
Keywords: MARKETS JAPAN STOCKS HOT/