Dollar Falls, Stocks End Mixed
TOKYO (AP) _ The dollar fell against the Japanese yen today on reports that Prime Minister Kiichi Miyazawa favors a rise in the yen to reduce Japan’s trade surplus. Prices on the Tokyo Stock Exchange rose moderately.
The dollar closed at 113.43 yen, down 0.04 yen from Wednesday’s close. It opened at 113.67 yen and ranged between 113.28 yen and 114.08 yen. It closed in New York at 113.88 yen overnight.
Dealers said the dollar dipped suddenly in mid-afternoon on reports about an article in today’s editions of the Washington Post. The article suggested Miyazawa would support a stronger yen to trim Japan’s ballooning trade surplus when he meets President Clinton Friday in Washington.
Japan has largely accepted a rise in the yen as inevitable given its $49 billion trade surplus with the United States, but the yen’s sudden appreciation recently as Japan struggles to climb out of recession is considered a cause for concern.
When reports of the Post article were circulated, the dollar plummeted to as low as 113.15 yen from 113.90 yen in about 15 minutes, dealers said.
″The dollar fell quite a bit because many players dumped it at once,″ said Ryoko Kawashima, a Citibank dealer.
The dollar stabilized shortly before the close, Kawashima said.
In the morning session, the dollar rose against the yen as players bought back the U.S. currency following its recent fall.
The dollar has closed at record lows against the yen on six of the previous 10 trading days.
On the stock market, the 225-issue Nikkei Stock Average gained 142.46 points, or 0.69 percent, to end at 20,675.84. On Wednesday, the Nikkei fell 206.91 points, or 1.0 percent, closing at 20,533.38 points.
The Tokyo Stock Price Index of all issues listed on the market’s first section lost 3.07 points, or 0.19 percent, to 1,589.73. The TOPIX shed 15.96 points, or 0.99 percent, to close at 1,592.80 points the day before.
Volume on the first section fell to an estimated 620 million shares from Wednesday’s 830 million. Advancing issues outnumbered losers 590 to 497, with 144 unchanged.
Last-minute arbitrage buying propped up the Nikkei despite profit-taking on large-capitalization issues that swelled during the Nikkei’s 850-point rally Tuesday, traders said. The Tuesday rally followed the government’s announcement of a $1.5 billion economic stimulus package.
The price of benchmark 10-year Japanese government bonds closed at 108.27 yen, down 0.07 yen from Wednesday’s close. Their yield rose 0.010 percentage points to 4.220 percent.