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Investing.com -- Shares of major Japanese automakers rose on Monday, tracking strength in Mitsubishi Motors Corp (TYO:7211) after the carmaker logged stronger-than-expected quarterly earnings.
Mitsubishi jumped as much as 5% after its net income and revenue blew past expectations for the June quarter, aided chiefly by higher domestic and North American retail sales.
Mitsubishi’s quarterly net sales rose 20% to ¥635.1 billion ($1 = ¥141.49), more than expectations of ¥594.1B, while earnings per share were ¥32.22, more than expectations of ¥15.38.
The stock was also the top performer on the Nikkei 225, which rose more than 1%.
The earnings painted an optimistic picture for upcoming financial reports from several of Mitsubishi’s Japanese peers, who are due to report their quarterly earnings in the coming weeks.
Nissan Motor Co Ltd (TYO:7201), which is set to report its earnings on Wednesday, rose nearly 3%, while Mazda Motor Corp (TYO:7261) and Toyota Motor Corp (TYO:7203), which are set to report earnings in early-August, rose 3% and 1.3%, respectively.
Sentiment toward carmakers was also boosted by Mitsubishi hiking its annual net sales and profit forecast for fiscal 2023, citing strong momentum in the North American market and a recovery in Japanese car sales.
The results indicate that an expected decline in car sales, due to rising interest rates and high inflation through the past year, may not have been as bad as initially expected.
North America, particularly the U.S. and Canada, are a sizeable automobile market, with a recovery in Mitsubishi’s sales likely reflecting a similar trend for its peers.
Automobile sales in the U.S. have improved this year amid easing inflation and amid recovering inventories in the country, as global supply chains stabilized after the Russia-Ukraine war and the COVID-19 shock.
U.S. new vehicle demand has also remained resilient despite rising interest rates and sluggish business activity.
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