Sony Margin Buys Hit 13-Year High Before Surprise Loss Announced
https://latestsnewsforyou.blogspot.com/2013/02/sony-margin-buys-hit-13-year-high.html
By Jonathan Burgos & Masaaki Iwamoto - Feb 7, 2013
Sony Corp.’s loss for the eighth consecutive quarter came as an unpleasant surprise for investors who borrowed money to bet the weaker yen would help turn around Japan’s biggest consumer electronics exporter.
A 59 percent jump this year in Tokyo by the maker of PlayStation game consoles helped drive to a 13-year high the number of shares being held in margin-trading accounts that profit if the stock rises, according to data compiled by Bloomberg. The accounts held 5.48 million shares as of yesterday, the highest since March 2000, the data show.
“Speculators who have been rushing to buy Sony on expectation that the weakening yen will turn the earnings around must be disappointed,” said Mitsushige Akino, Tokyo-based chief fund officer at Ichiyoshi Asset Management Co., which oversees about $356 million. “They will close their positions to take profits or minimize losses.”
The company, which is expected to unveil the PlayStation 4 later this month, has rebounded 92 percent after falling to a 32-year low on Dec. 4. Japanese exporters have rallied on speculation earnings will improve because of the weaker yen, Amir Anvarzadeh, a Singapore-based manager for Asia equity sales at BGC Partners Inc. said.
The Japanese yen slid in the last four months, the longest streak of monthly losses since August 2008. The currency has retreated about 15 percent since elections were announced Nov. 14 amid speculation new Prime Minister Shinzo Abe would take aggressive steps to fight deflation by weakening the currency.
‘Hot Money’
“Some of the hedge funds have been accumulating long positions on the back of speculation that Sony will be turning things around,” BGC’s Anvarzadeh said. “That quick, hot money is going to sell out. I don’t believe Sony is going to turn around soon.”
While Panasonic Corp. posted a surprise net income of 61 billion yen ($652 million) in the three months ended December, and Sharp made its first operating profit in five quarters, Sony posted a net loss of 10.8 billion yen as TV demand dropped and as consumers flocked to smartphones and tablet devices made by Samsung Electronics Co. and Apple Inc. That missed the average 21 billion-yen profit of three analyst estimates compiled by Bloomberg.
Sony is counting on new products to lure consumers away from Apple iPads and Samsung Galaxy devices. At last month’s Consumer Electronics Show in Las Vegas, it introduced higher- definition TVs, water-resistant Experia smartphones and a more- powerful digital camera. Sony has announced a PlayStation event for Feb. 20, stoking speculation that the company will unveil the fourth generation of the console.
“We need to see how these products perform before investing money back in Sony again,” said Yuuki Sakurai, president of Fukoku Capital Management Inc., which oversees $19 billion. “Sony still has not shown us how it will fight with Samsung or Apple and I find it dangerous for Sony to focus on smartphones as the market is quite competitive and volatile.”
Source:bloomberg.com
Sony Corp.’s loss for the eighth consecutive quarter came as an unpleasant surprise for investors who borrowed money to bet the weaker yen would help turn around Japan’s biggest consumer electronics exporter.
A 59 percent jump this year in Tokyo by the maker of PlayStation game consoles helped drive to a 13-year high the number of shares being held in margin-trading accounts that profit if the stock rises, according to data compiled by Bloomberg. The accounts held 5.48 million shares as of yesterday, the highest since March 2000, the data show.
“Speculators who have been rushing to buy Sony on expectation that the weakening yen will turn the earnings around must be disappointed,” said Mitsushige Akino, Tokyo-based chief fund officer at Ichiyoshi Asset Management Co., which oversees about $356 million. “They will close their positions to take profits or minimize losses.”
The company, which is expected to unveil the PlayStation 4 later this month, has rebounded 92 percent after falling to a 32-year low on Dec. 4. Japanese exporters have rallied on speculation earnings will improve because of the weaker yen, Amir Anvarzadeh, a Singapore-based manager for Asia equity sales at BGC Partners Inc. said.
The Japanese yen slid in the last four months, the longest streak of monthly losses since August 2008. The currency has retreated about 15 percent since elections were announced Nov. 14 amid speculation new Prime Minister Shinzo Abe would take aggressive steps to fight deflation by weakening the currency.
‘Hot Money’
“Some of the hedge funds have been accumulating long positions on the back of speculation that Sony will be turning things around,” BGC’s Anvarzadeh said. “That quick, hot money is going to sell out. I don’t believe Sony is going to turn around soon.”
While Panasonic Corp. posted a surprise net income of 61 billion yen ($652 million) in the three months ended December, and Sharp made its first operating profit in five quarters, Sony posted a net loss of 10.8 billion yen as TV demand dropped and as consumers flocked to smartphones and tablet devices made by Samsung Electronics Co. and Apple Inc. That missed the average 21 billion-yen profit of three analyst estimates compiled by Bloomberg.
Sony is counting on new products to lure consumers away from Apple iPads and Samsung Galaxy devices. At last month’s Consumer Electronics Show in Las Vegas, it introduced higher- definition TVs, water-resistant Experia smartphones and a more- powerful digital camera. Sony has announced a PlayStation event for Feb. 20, stoking speculation that the company will unveil the fourth generation of the console.
“We need to see how these products perform before investing money back in Sony again,” said Yuuki Sakurai, president of Fukoku Capital Management Inc., which oversees $19 billion. “Sony still has not shown us how it will fight with Samsung or Apple and I find it dangerous for Sony to focus on smartphones as the market is quite competitive and volatile.”
Source:bloomberg.com
