Japan stimulus boosts Honda and Toyota stock
DETROIT (AP) — U.S. shares of Toyota, Honda and Nissan soared Thursday as investors anticipated that a weaker yen will allow them to sell cars more cheaply in the critical U.S. market.
The Bank of Japan plans to increase the amount of cash in circulation, a move that will depress the value of the yen against the dollar. That will lower the cost of producing Japanese imports for Americans.
Shares of Toyota, Honda and Nissan all rose more than 4 percent as some analysts predicted a drop in Japanese car prices. But they also say the effect of the weaker yen will be blunted because those companies have previously moved so much of their production to North America.
The yen weakened 3.5 percent against the dollar. Shares of Ford Motor Co. and General Motors Co. fell slightly.
GM CEO Dan Akerson told CNBC Thursday that he's worried the Bank of Japan's actions will give Japanese automakers a price advantage in the U.S., the world's second-biggest car market after China.
"They're an export economy. You have to be suspicious of what they're doing and why," Akerson said.
A weaker yen helps Japanese carmakers because it lowers the cost of producing cars in Japan. Cars built more cheaply there and then imported and sold in the U.S. bring higher profits to Japanese companies.