Japanese Stocks Rise on U.S. Manufacturing; Shipping Lines Drop

Japanese shares rose after U.S. manufacturing figures added to signs the global recession is abating and General Motors Corp.'s bankruptcy raised optimism Japan's automakers will gain market share.

Honda Motor Corp., the nation's No. 2 carmaker, jumped 2.2 percent, while Toyota Motor Corp., which overtook GM last year as the biggest automaker globally, added 0.8 percent. Sony Corp., maker of the PlayStation 3 game machine, climbed 4.3 percent. Nippon Yusen KK, the nation's No. 1 shipping line, lost 1.7 percent as investors speculated the shares have risen too fast. Stocks pared gains after Yonhap News said North Korea is preparing to launch a medium-range missile.

The Nikkei 225 Stock Average climbed for a fifth day, adding 26.56, or 0.3 percent, to close at 9,704.31 in Tokyo, the highest since Oct. 7. The broader Topix index inched up 1.04, or 0.1 percent, to 913.56, with almost three shares advancing for every two that retreated.

"Markets around the world have been rising steadily from the middle of last week, and investors have just about exhausted their appetite for buying," said Kiyoshi Ishigane, a senior strategist at Mitsubishi UFJ Asset Management Co., which oversees about $61 billion in Tokyo. "There's concern shares are overbought."

In the U.S., The Institute for Supply Management's factory index rose in May to 42.8 from 40.1 the previous month. The result was less than the 50 level that signals growth, while economists estimated the gauge would gain to 42.3. A measure of new orders, a leading indicator of Japanese exports, signaled an expansion for the first time since September 2007.

Economic stimulus packages introduced by governments around the world to combat the global recession total $2.2 trillion, according to Bloomberg calculations. In China alone, the government is investing $856 billion in roads, bridges and low- cost housing.

GM, the world's largest carmaker until its 77-year reign ended last year, filed for bankruptcy protection in the U.S. yesterday with a plan to create a viable company that can compete in world markets. The Detroit-based automaker plans to sell unprofitable brands and close at least 11 factories before emerging as a new, smaller company in 60 to 90 days. a