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Stocks Mixed, Dollar Edges Lower

January 29, 1992

TOKYO (AP) _ The dollar weakened against the Japanese yen today after President Bush’s State of the Union message supported lower U.S. interest rates. Tokyo share prices were mixed.

The dollar closed at 125.17 yen, down 0.20 yen from Tuesday’s close and below its overnight finish of 125.70 in New York.

It opened at 125.55 yen, but quickly fell after Bush stated that he would keep interest rates and inflation low, traders said. The dollar ranged between 124.88 yen and 125.60 yen.

Spot trading totaled $8.59 billion, up from Tuesday’s $5.91 billion.

″Market players quickly responded to President Bush’s remarks supporting an easy monetary policy by selling the dollar,″ said Masamichi Yasuda, a Bank of Tokyo trader.

The U.S. currency recovered from the day’s low, however, on bargain- hunting, Yasuda said.

He said Japanese investors were reluctant to push the dollar lower as they awaited the release later today of U.S. gross domestic product figures for last year’s fourth quarter.

On the stock exchange, the 225-issue Nikkei Stock Average, down 142.40 points at the end of the morning session, rebounded slightly, closing at 21,362.26, down 28.26 points, or 0.13 percent. It had gained 383.41 points on Tuesday.

The Tokyo Stock Price Index of all issues listed on the first section gained 1.26 points, or 0.08 percent, closing at 1,584.73. After gaining 9.00 points, or 0.57 percent, the previous day, it was down 5.24 points at the end of the morning session.

Trading was thin, with first section volume estimated at 180 million shares, up from Tuesday’s 160 million.

Advancing issues outnumbered decliners 469 to 408, while 218 issues remained unchanged.

Traders said share prices rose in early trading on reports that a Japanese- U.S. consortium had been awarded a project worth an estimated $10 billion to develop oil and gas off the Russian island of Sakhalin.

Prices turned down on intermittent arbitrage selling to take profits from price gaps between the spot and futures markets, but then recovered partially in the afternoon on bargain-hunting, said Masashi Wakabayashi, an analyst with Yamaichi Securities Co.

Wakabayashi said, however, ″The Tokyo market doesn’t have enough power to maintain gains.″

The Tokyo stock market barely reacted to Bush’s State of the Union message, Wakabayashi added.

The benchmark 129 10-year Japanese government bonds closed at 106.65 points, up from Tuesday’s 106.47-point finish. Their yield fell to 5.230 percent from 5.260 percent.

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