Japan stock market week to Feb 9, 2009

Tokyo extended its gain for a second week, following mixed moves in the review week to February 9. The Nikkei 225 rose 1.2%, although it still  finished below the psychologically-important 8,000 mark, while the Topix  index inched up 0.1%. The market was strong mid-week, reflecting  Japanese investors' purchasing of machinery, shipbuilding and steel  stocks in anticipation of a recovery in the Chinese economy. The last  two sessions saw a downturn due to profit-taking of the China-related  issues and players resumed focusing on Japanese companies' dismal  third-quarter earnings and increasingly uncertain outlook for the full  year to March 2009. The pharmaceutical index lost 3.0%, underperforming  the market.

Astellas went up 3.0%, after it raised its full-year profit guidance  with the reporting of results for the nine months to December 2008,  based on expected growth of core products in global markets, as well as  the positive impact of the yen's rise on costs and expenses of overseas  subsidiaries. Cumulative nine-month turnover edged down 0.8% to 759.0  billion yen ($8.27 billion) and operating income decreased 9.9% to 221.2  billion yen compared with the like, year-ago period. However, global  revenue from the immunosuppressant Prograf (tacrolimus) increased 1.9%  to 156.9 billion yen. The drug registered a 15.1% increase to 22.1  billion yen in Japan and US revenue was up 5.0% to $669.0 million,  without the emergence of generic competition although Prograf's US  patent expired in April 2008.

Daiichi Sankyo edged down 0.7%, following an 11.9% rise in the previous  week, despite its announcement - together with Eli Lilly - that the US  Food and Drug Administration's Cardiovascular and Renal Drugs Advisory  Committee had voted nine to zero that the anti-platelet agent prasugrel  (expected trade name Effient) should be approved for the treatment of  patients with acute coronary syndromes managed with percutanous coronary  intervention (Marketletter February 9). The stock's performance likely  reflects investors' perception that the Committee's recommendation  represents a positive development but the timing of the FDA's approval  and the scope of the expected indication are uncertain at this stage.