Japanese stockbrokers rebound: Big Four return to the black in first six months

TOKYO (AFP) - Buoyed by increased trading volumes, Japan's leading stockbrokers posted a sharp rebound in first-half earnings yesterday.

After three difficult years punctuated by losses, the Big Four securities companies were in the black in the six months to September.

Even though most of the other 21 securities houses were in the red, their losses were generally smaller in the wake of a recovery in share trading volumes and a resurgent bond market accompanied by efforts to reduce costs.

Nomura Securities, the country's biggest broker, made pre-tax profit of Y25.3bn ( pounds 159m) in the first half, up from Y983m in the same period last year. Operating revenues rebounded 13 per cent to Y202bn.

Second-ranked Daiwa Securities posted earnings of Y35.4bn, up from Y1.87bn a year earlier, while its operating revenue climbed 19 per cent to Y158bn.

Nikko Securities raised pre-tax profits to Y12.9bn, up from Y948m. Operating revenue rose 16 per cent to Y138bn.

Yamaichi Securities posted a Y11.3bn profit, reversing a Y19.3bn loss. Revenue leapt 24 per cent to Y121bn. Commissions from trading and underwriting, accounting for about two thirds of revenue, were up sharply.

During the six-month period, average daily turnover on the Tokyo Stock Exchange leapt 37 per cent to 390 million shares. Turnover increased by more than 50 per cent.

Prices also rose with the Nikkei Stock Average jumping from 17,000 points a year earlier to more than 21,000 points before settling around 20,000 points. The market, however, remains fragile and prices are still only half their peak level.

With prospects of rapid economic recovery fading in the wake of the yen's appreciation and an unusually cool summer, stock trading volumes have recently started to dwindle again, to fewer than 250 million shares a day.

(Photograph omitted)