welcome to "newsline." it is wednesday, july 22nd. i'm catherine kobayashi in tokyo. top executives at electronics giant toshiba have resigned over an accounting scandal. the president and two of his predecessors stepped down to take responsibility for systematic wrongdoing at the firm. >> translator: we sincerely admit to having caused the trouble. i genuinely apologize to all of our shareholders and those who are involved in our businesses. i am deeply sorry.
>> president tanaka attended an emergency board meeting on tuesday with norio sasaki and atsutoshi nishida. they told board members they were quitting. sasaki had been serving as vice chairman and nishida as an adviser to the board. on monday, members of a special panel released the findings of a investigation into irregularities at toshiba. in the report they blamed executives for inflating profits. they said there was a systematic problem at the firm that went all the way to the top. they also said toshiba will have to write down operating profits between fiscal 2008 and 2014 by about $1.2 billion. the panel members found irregularities in a wide range of toshiba's businesses, including infrastructure building, semiconductors, and personal computers. members of the panel met with reporters on tuesday after issuing the report. >> translator: we were shocked to discover that one of the most
prominent companies in japan systematically padded its earnings. >> the panel leader also said a corporate culture that puts profit above anything else was at the root of the scandal. he added that what toshiba did was irregular accounting, but that some individual cases may amount to wrongdoing. eda indicated that the valuation of toshiba's assets could be downgraded further depending on consultations between the company and an auditing firm. toshiba is scrambling to form a new management team. the company plans to name the team by mid-august. toshiba says the chairman of the board masashi muromachi will temporarily replace tanaka as president. it says independent directors will account for a majority of the board. and the in-house audit committee will be headed by an outsider. toshiba says it will set up a panel to draw measures to prevent a similar scandal. meanwhile officials at the
tokyo stock exchange are expected to take action. gene otani is here with us with all the details. so gene tell us about this. what measures are going to be taken? >> we're starting to see some of the sidesques of what's going on in toshiba. the officials are likely to move toshiba into the alert category. regulations state companies that falsify earnings reports remain listed to protect investors but the shares of such firms are designated as securities on alert. the tse will examine the panel's findings as well as a revised earnings report toshiba is expected to submit in late august. in exchange will ask the company to improve its internal management if it finds that they failed to make progress after one year it would be delisted. the exchange is also considering filing a demand with toshiba to pay a record sum of about $730,000 in fines. the money would be compensation for damaging the trust of
shareholders and investors. checking the markets, usa and european stocks reversed their recent gains overnight. mayu yoshida is here. how are tokyo stocks reacting especially after the news from attorneytoshiba toshiba? >> toshiba's accounting scandal came only a month after japan introduced a corporate governance code so market watchers are worried about it taking a hit on abenomics because it was one of his key growth strategies. let's check the opening levels for this wednesday morning. the nikkei is snapping a six-day winning streak but it's still not so far from its 18-year high. the nikkei is down nearly 1% opening at 20,647. meanwhile, the topix broke seven consecutive sessions. down 0.8%.
over in wall street lack luster earnings from a blue blue chip stocks pressured u.s. stocks. disappointing sales from ibm hit the dow hard down exactly 1%. and the nasdaq dropped 0.2%. slowdown in construction in china caused shares to fall 7%. other than ibm and united technologies apple stocks weighed on the dow. analysts say that they're worrying about investors sold stocks as manufacturers with high exposure to overseas because they're worrying about the impact from the stronger dollar and sluggish chinese economy. however, the shanghai composite meanwhile closed above 4,000 for the first time in three weeks on optimism over the government measures to boost the market. so focuses on chinese markets today as well. going back to japan, investors are confident about corporate earnings but the toshiba scandal is making some foreign investors
worry about other japanese firms because it was long a struggle for japanese companies to set up an open dialogue between companies and shareholders but some are positive and they think the scandal could force toshiba more global and open. >> mayu you talked about the strong dollar. how are the major currencies trading now? >> the dollar is sort of losing ground against the yen. it's currently around 123.87 after hitting a one-month high yesterday. many sold the dollar after yields on the u.s. treasury notes went lower. but one currency dealer says it will remain in line with trading hours today. the euro is rebounding from a three-month low against the dollar. it's now around 1.0941. major companies in japan will start announcing their earnings from today to start off the world's largest manufacturer of motors will release their numbers later today. that's it for now.
back to you. >> mayu thanks. reporting live from the tokyo stock exchange. tourists from overseas are snapping up goods at japan's department store. the retailers in june posted a third straight month of higher sales. the year on year figures show the foreign visitors quadrupled their spending offsetting a decline in clothing sales. officials of the japan department stores association say sales at 238 stores nationwide totaled nearly $4 billion last month. that's a rise of 0.4% from june last year in yen terms. clothing sales fell over 7%. temperatures were lower than usual on many days cooling off sales of summerwear. wristwatchers and jewelry were popular with sales up nearly 28%. cosmetics surged more than 20%. much of the buyers were from china vacationing during the month. the association officials predict higher sales this month mainly from summer sales.
vertical images are becoming the norm as more people look at pictures the on smartphones. companies are taking notice of the shift and turning it into a business opportunity. >> one website is taking advantage of how people use smartphones and is posting videos filmed vertically. >> translator: i'd like to try on this beach dress. >> reporter: this reporter is filming for a website that introduces fashion and food trends on video. she always shoots vertically. if the scene is filmed horizontally, it looks like this. the vertical image leaves out unnecessary details on the right and left and looks neat and sharp. the company started posting videos in april.
its website is popular with young female smartphone users. it got over 1 million hits in a single month. >> just changing a horizontal image to a vertical one gives it a brand-new feel. this is very important for business and has become a great asset. >> another major change is being seen in the comics industry. this company uploads new episodes of its 20 comic titles every day. it's attracted about 10 million users since starting out 20 months ago. the secret to its success lies in its original method of writing comics for a vertical layout. this popular artist publishes his work with the company. he began creating comics for smartphones one year ago. the design is quite different to
the approach he use ed d. if printed comic books are simply digitized to be enjoyed on smartphones readers need to take the trouble to enlarge the smaller image ss. so the comic art is published by the company makes it big so users can read it easily. and the images are laid out to enable readers to scroll the pages vertically. >> when you turn to a new page of a comic book you see all the boxes at a glance. but on a smartphone, you can't see the next image until you scroll down. this provides a sense of anticipation. >> reporter: the change has also helped the company expand into the overseas market.
conventional japanese comics run from right to left. on the other hand, comics in the u.s. europe and south korea read from left to right. this makes japanese comics challenging for some people overseas. scrolling the images from top to bottom makes it easier for them to follow the order. the company started providing comics for markets in south korea and taiwan last year. it then gained a foothold in the global market. >> translator: as the number of users increases, we can offer more and more quality content for smartphones. we will surely become an influential company in the comics industry. >> reporter: the spread of smartphones has made consumers familiar with vertical images.
the trend is generating new business opportunities in the digital content industry. >> that's it for business news. i'll leave you with the markets. on to other stories we're following this hour. japanese astronaut kimiya yui is looking forward to his first trip to space. he will lift off from the baikonur center in kazakhstan carrying yue and two other members to the international
space station. he talked to other members on tuesday. >> i really feel calm and comfortable and also i feel like 100% sure our mission will be successful. >> he expressed gratitude to his family for supporting him all the way. >> the main message for my family is i like to thank you very much for your support. not only family but everybody supported. but family support was like the most biggest and also significant. >> he said he's especially proud of his hardworking father whom he's always looked up to. the launch of the soyuz has been delayed by two months because an unmanned russian cargo ship failed to reach the iss. yui said the soyuz is highly reliable and that he's confident all the spacecraft systems will function properly. he said that when the japanese cargo ship kontori docks with
the iss in august he'll operate a robotic arm and work with koichi wakata who will be at ground control. yui said his time aboard the iss will be a major mission and that he wants to fulfill his responsibilities. japanese defense officials say they're growing more concerned about china's increased presence in the south and east china seas. they submitted on tuesday their report to the cabinet. and they say japan must do more to protect the country. nhk world's reports. >> one of the main focuses of this year's report is china. it includes a new section on maritime trends. the report refers to china's rapid and large scale reclamation of reefs in the disputed spratly islands in the south china sea. it says incidents where countries unilaterally assert their interests or attempt to alter the status quo by coercive measures are occurring more often.
>> translator: we explained our analysis and evaluations about the recent activities by the chinese military expanding and intensifying their actions in the sea and air around japan. we want to convey the present situation accurately because it's a matter of concern. >> the report also refers to national security legislation that's now being discussed in the diet. it says that ensuring safety of sea lanes is a vital issue to japan's survival. public opinion polls show not many people in the country understand or support the bills. observers say the government is expected to repeat the explanation that the bills are designed to boost defense deterrence as the security environment around the country gets more severe.
reporting for nhk world. the commander of the u.s. navy's pacific fleet says he's also concerned about the work china is doing. admiral scott swift spoke to reporters in tokyo. >> we've seen typical maritime operations on behalf of both the chinese coast guard and the chinese navy. despite what we can observe directly, we can't predict what intent is. >> admiral swift said u.s. planes and ships will continue to patrol the area. he also said the u.s. will urge china to make its intentions clear. the commander referred to the set of security bills under deliberation in japan's diet. >> if it were to pass into law, the effect on the pacific fleets' relationship with the japanese maritime defense force will be evolutionary not revolutionary as a result. >> defense minister nakatani and
admiral swift agreed they'll continue to cooperate on their response to china's activities in the south china sea. nakatani said defense ministers from japan, the u.s. and australia have agreed to coordinate response to any attempts to change the status quo by force. swift said it's important the countries keep consulting closely with each other. a foreign ministry spokesperson said his government is strongly dissatisfied and opposed. lu kang says the report deliberately plays up the china threat and stirs up tensions. he also referred to the reclamation work in the spratly islands. he says this is fully within china's sovereignty and beyond reproach. lu says japan has been deliberately intervening in the south china sea issue. he says the actions run counter to regional peace and stability and he says it severely undermines the mutual trust between the two neighbors.
it seems traditional clothes in japan out. kimono sales are down to a sixth of what they were 30 years ago. with the 2020 games coming to tokyo, one retailer is producing garments expressing the world's diversity. his italian themed kimono debuted in milan . >> reporter: a parade showcasing japanese culture attracts throngs of visitors at the expo in milan. a kimono draws smiling crowds. italian culture and history inspired the design. he designed the government. he runs a retail company selling
kimonos. a decline in people wearing traditional clothes has seen the kimono business facing hard times. he says the biggest task is finding a way to pass on the art when the artists are aging. >> translator: if we don't do something, the kimono culture will disappear. >> reporter: to preserve the best skilled and artworks he took all the major creators in japan to join his project. he visits one of the finest kimono makers in kyoto. the theme for italy was the renaissance. takakura wants the garments to have elements of both tradition and today's world. 7 this 75-year-old took on the challenge. he uses wagashi or the technique of color gradation to bring out the landscapes.
he's an artist with more than 50 years behind the brush. >> translator: i'm happy with my work on this kimono. i'd like people to enjoy what the color gradation gives to the design. >> reporter: now, takakura's moved on to obi, the belt. he spoke to the top maker in kyoto. the obi will be an expression of modern italy. >> translator: i want that italian car red. >> reporter: it was an unusual request for the manufacturer. the metallic red doesn't exist in traditional japanese kimonos. the designer also suggested weaving in some glitter. for the headlights they used thick gold and rainbow threads. it gives some glimmer and creates some depth. it took three months to make the
kimono and obi. you can see a town through the cathedral arch. the gradation gives a 3-d effect. there's even a helicopter designed by leonardo da vinci in the sky. it's a glimpse of takakura's sense of humor. the obi was dedicated to people in italy with a wish for a bright future. the fine skills of the artists made it possible to make the garment shine. the italians seemed to appreciate the symbol of the kimono as it communicates the spirit from some of the master artists in japan. >> translator: i love the way they tie the belt. everything is beautiful. >> translator: the kimono and
obi have become a successful merging of tradition and novelty. an italian should be able to notice the specific red used in the obi. >> translator: kimonos are not only the national garment of japan, but i'm happy they also can communicate and express flavors from around the world. they truly can be a universal garment. >> reporter: it's five years until the 2020 tokyo games. not only gold but silver bronze and many other colors are all set to be winners in takakura's event. reporting for nhk world. time for a check of the weather. it's a hot and humid morning in tokyo. mai shoji join us with the latest in world weather. >> the heat personally i'm fine with it. but the combination of strong winds and the radiance from concrete ground and the humidity. these are all great recipes for heat stroke.
i'm afraid to tell you we're not going to get a break from that. let me show you a video that shows you the conditions across much of japan. take a look at that. hitting 37 degrees. certainly winds surging across japan today have led to extreme heat across the country. tuesday makes it one of the hottest days of the year for 2015 across much of the kanto region. and risks for heat stroke against on wednesday. kagoshima has seen heavy amounts of rain comparable to the height of the rainy season. many locations in kagoshima have seen record breaking amounts of rain for the month of july. they'll be in the process of rewriting the record books again today because we are seeing this much amounts of rainfall in just two days. 620 millimeters of rain in parts of kagoshima. unfortunately, swre the surge of that moisture and indirectly the typhoon halola is creating that
surge, too. the heat will continue from the high pressure system out here and we have a stationary boundary stretching in across hokkaido. these are two areas that we will be seeing enough significant amount of rainfall to cause some flooding. now, kyushu about 150 millimeters on top of the 600 we've already seen. some of the structures are actually secure because they're used to these heavy rainfall. but up in hokkaido, they're not used to this rainfall for this time of year and structures are very prone to flooding and the inundation. so 100 millimeters into thursday morning that could be very problematic. pop-up thunderstorms will be caused across much of japan today especially after the daytime heating. talking about the heat though it was really hot yesterday. 37 degrees here across tatebayashi and even up in tohoku 36 degrees. the heat will continue.
niigata hit the end of rainy season yesterday. 33 degrees. tokyo hitting 34 again. kyoto, where the big famous festival gion is being held right now. unfortunately you'll see rain fall into your thursday. now, let's check the typhoon that we have been tracking. had is h this is hal lrksola. it looks like it will be disburseing by the time it moves into the mainland areas of japan. it will be the painful that will be very problematic. out here across the u.s. we have a stationary boundary that's stretching all the way into the southern plains and mid-atlantic states. anywhere along it we're likely to see large hail storms as well as very heavy rainfall. the bulk of the very heavy rain will be around oklahoma and northern texas and into
arkansas. where we want the rain the red flag warning is still in place across oregon and washington states. the relative low humidity down to just around 10% and the gusts could reach 10010 kilometers per hour. i'll leave you now with the extended forecast. 10 kilometers per hour. i'll leave you now with the extended forecast. 10 kilometers per hour. i'll leave you now with the extended forecast.
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