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Tokyo Stocks Fall in Early Trading

August 27, 1999

TOKYO (AP) _ The dollar edged higher against the yen early Friday, while Japanese stocks opened mixed as investors remained unsure where the greenback is heading.

The dollar bought 111.78 yen, up 0.72 yen from late Thursday in Tokyo and also above its late New York level of 111.54 yen.

The benchmark 225-issue Nikkei Stock Average shed 24.48 points, or 0.14 percent, to 17,641.81 in the first 30 minutes of trading. On Thursday, the average closed down 188.87 points, or 1.06 percent.

In currency dealings, the dollar’s strength against the Japanese currency derived largely from the Nikkei stock average’s third straight decline Thursday.

Analysts said the yen’s outlook against the dollar remains uncertain amid a tug-of-war between continued demand for the Japanese currency among global investors to invest in markets here and fears of central bank intervention.

The Bank of Japan has entered the market to buy dollars in recent months to stem the yen’s rapid rise against the U.S. currency.

A stronger yen makes Japanese exports more expensive abroad and thus less competitive, cutting into earnings of export-oriented Japanese companies.

In other currencies, the euro was traded at 116.80 yen, up from 115.72 yen late Thursday in Tokyo.

On the stock market, prices fluctuated in a narrow range amid worries over the effects of a higher yen on the earnings of exporters.

International blue chip exporters were mixed, with issues such as Toyota and Honda higher, while Sony moved lower.

In New York, the Dow Jones industrial average fell 127.59 points to 11,198.45 at Thursday’s close after setting a new record high Wednesday.

The broader Tokyo Stock Price Index of all issues listed on the first section was up 6.34 points, or 0.43 percent, to 1,487.42. The TOPIX closed down 13.72 points, or 0.09 percent, the day before.

The yield on the benchmark 10-year Japanese government bond rose to 1.9450 percent from Thursday’s finish of 1.9400 percent, driving its price down to 99.62 yen from 99.66 yen.

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