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By Taiga Uranaka
TOKYO, Feb 4 (Reuters) - Shares of two Yahoo Inc-related
Japanese companies soared on Monday, helping push the Nikkei
average up more than 2 percent by the midday break of trade.
The market was also buoyed by reports of potential rescue
plans for large U.S. bond insurers that have been battered by the
global credit crunch.
Softbank Corp <9984.T> leapt 13.2 percent after Microsoft's
<MSFT.O> $44.6 billion bid for Yahoo, while Yahoo Japan Corp
<4689.T> shares were untraded due to a glut of buy orders.
"The No. 1 reason for today's gain is the monolines, and the
second is Yahoo," said Tomokatsu Mori, chief fund manager at
Fukoku Capital Management.
"The market has been moved by the monoline problem," he said,
referring to bond insurers, which have been hit by downgrades by
rating agencies amid a deteriorating subprime mortgage market.
A group of large banks has joined together to find ways to
shore up Ambac Financial Group <ABK.N>, two people briefed on the
talks said on Friday. []
Downgrades of bond insurers are widely seen as hurting not
only the financial industry but also the broader economy.
Japanese bank shares rose sharply, with No. 1 Mitsubishi UFJ
Financial Group <8306.T> gaining 3.9 percent to 1,034 yen.
Tracking gains on Wall Street last week, high-tech exporters
also rose, with TDK Corp <6762.T> up 4.4 percent at 7,760 yen,
and Fanuc Ltd <6954.T> climbing 4.3 percent to 9,660 yen.
Automaker Honda Motor <7267.T> advanced 3.3 percent to 3,440 yen.
The benchmark Nikkei average <> ended the morning up
335.24 points at 13,832.40. The broader TOPIX index <> added
2 percent to 1,364.18.
Trade slowed on the Tokyo exchange's first section, with
938.3 million shares changing hands, compared with last week's
morning average of 976.2 million. Advancers beat decliners by a
ratio of more than five to one.
YAHOO! FOR SOFTBANK
Softbank, which owns 3.9 percent of Yahoo Inc in terms of
voting rights, jumped 13.2 percent to 2,155 yen, by far the
biggest contributor to the Nikkei.
Yahoo Japan was bid up at 46,000 yen, up 9.5 percent from
Friday's close. Yahoo Japan is owned 41 percent by Softbank and
33 percent by Yahoo Inc.
Microsoft Corp has offered to buy Yahoo Inc in a bold bid to
transform two ailing Internet businesses into a worthy competitor
to market leader Google Inc <GOOG.O>. []
A Microsoft acquisition of Yahoo Inc would likely result in a
tie-up between Microsoft, Softbank and Yahoo Japan, establishing
a more potent challenge to Google in the Japanese market, the
Nikkei business daily reported on Saturday.
Mizuho Securities analyst Yuichi Sato said the deal, if
realised, would be highly positive for Yahoo Japan as Microsoft's
financial prowess and technological expertise would help Yahoo
Inc and Yahoo Japan compete better with Google in Internet search
services.
The brokerage raised its investment rating on Yahoo Japan to
"1" from "2".
Sharp Corp <6753.T> surged 6.6 percent to 1,947 yen after the
consumer electronics maker reported on Friday that its quarterly
operating profit grew 5.5 percent to a record high on a solid
performance by its flat panel operations. []
Sharp, the world's third-largest LCD TV maker behind Samsung
Electronics Co Ltd <005930.KS> and Sony Corp <6758.T>, said its
operating profit totalled 52 billion yen ($490 million) in
October-December, up from 49.3 billion yen a year earlier.
Chugai Pharmaceutical Co Ltd <4519.T> tumbled 7.1 percent to
1,119 yen, its third consecutive session of losses after it
issued a "shock" bearish outlook last Wednesday.
(Editing by Hugh Lawson)
