Stocks Recover, Dollar Remains Lower
TOKYO (AP) _ Share prices recovered early losses in morning trading Thursday, while the dollar remained lower against the Japanese yen.
The 225-issue Nikkei Stock Average gained 137.61 points, or 0.79 percent, closing the morning session at 17,406.32. On Wednesday, the average fell 212.03 points, or 1.21 percent.
The Tokyo Stock Price Index of all issues listed on the first section was up 5.55 points, or 0.42 percent, to 1,322.88. The TOPIX posted a 8.57-point fall, or 0.65 percent, the day before.
Mitsuru Kanno, an analyst with Wako Securities, said prices started moderately lower following an overnight 29.18-point fall on Wall Street, but arbitrage buying reversed the course.
In arbitrage trading, investors seek profits from price differentials between the spot and futures markets.
Kanno said continued buying by public pension funds supported the mid- morning rise, as incentive-backed issues with good prospective earnings drew investors’ attention.
An increased investment by public funds is part of a government package announced in late August to rescue the weakening stock market.
On the foreign exchange market, the dollar was changing hands at 123.22 yen, down 0.65 yen from Wednesday’s close. It opened at 123.18 yen after finishing its overnight New York trading at 122.95 yen.
Currency dealers said the yen carried over its overnight strength against the dollar in overseas markets. But moderate buying by Japanese importers nudged the dollar higher from its opening level.
Shinichiro Ohashi, a dealer with Tokai Bank, said trading in Tokyo would be limited as players remain more watchful of developments in the European Monetary System.
The yield on benchmark No. 145 10-year Japanese government bonds fell to 4.610 percent from Wednesday’s 4.615-percent finish. Their price rose to 105.75 points from 105.71.