Dollar Recovers Slightly From Opening Level, Stocks Slip
TOKYO (AP) _ The dollar moved slightly higher late Tuesday morning from its opening level against the yen and share prices slipped in thin trading.
The dollar was changing hands at 129.37 yen in late morning trading, down 1.37 yen from Friday’s close. It opened at 129.32 yen after finishing overnight at 129.185 yen in New York.
Japan’s financial markets were closed Monday because of a national holiday.
On the stock exchange, the 225-issue Nikkei Stock Average fell 81.37 points, or 0.32 percent, closing the morning session at 24,962.87. The index was off about 70 points early in the afternoon session.
The index fell 178.04 points, or 0.71 percent, Friday.
The Tokyo Stock Price Index of all issues listed on the first section stood at 1,880.76 points, down 1 point, or 0.05 percent, from Friday’s close.
By late morning, the benchmark No. 129 10-year Japanese government bonds edged down to 102.79 points from Friday’s 102.96-point finish. Their yield rose to 5.900 percent from 5.870 percent.
In currency trading, the dollar gained slightly from its opening level in narrow trading.
Masaru Furusawa, a dealer with Fuji Bank, said the dollar’s slide stopped at around 129.50 yen on buying from importing firms.
The dollar started lower following an overnight drop in New York, where it sank on anticipation that the U.S. Federal Reserve would cut interest rates to stimulate the American economy.
″There is speculation that the Fed may cut its official discount rate by 0.5 percentage point after the Federal Open Market Committee″ meets Tuesday, Furusawa said.
The dollar, like other currencies, draws support from stable or high interest rates.
Stock traders said share prices remained lower on small-lot selling as investors were holding back due to a lack of fresh market-moving news and an overnight decline on Wall Street.
″The market is correcting itself after the Nikkei regained 17 percent over the past three months to near 25,000 points from the 21,500-point level in mid-August,″ said Yoshio Oshima, an analyst with Kankaku Securities.
He said prospects of lower interest rates both in Japan and the United States have been helping encourage stock investment.