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Tokyo share prices Rise

October 5, 1999

TOKYO (AP) _ Tokyo share prices gained moderately Tuesday, as investors awaited the U.S. Federal Reserve’s policy meeting later in the day. The U.S. dollar rose against the yen.

The benchmark 225-issue Nikkei Stock Average closed up 20.44 points, or 0.12 percent, to 17,784.15. The average closed up 51.15 points, or 0.29 percent, the previous day.

The U.S. dollar was trading at 106.60 yen at 5 p.m. (0800 GMT) Tuesday, up 0.49 yen from late Monday in Tokyo and also above its level of 106.30 yen overnight in New York.. The greenback traded during the day from 105.88 yen to 106.77 yen.

On the stock market, share prices closed slightly higher, but investors remained cautious ahead of the Fed’s meeting.

``The wait-and-see attitude grew in the afternoon,″ said Hidenori Karaki, general manager at Tokyo-Mitsubishi Personal Securities.

Although many expect the Federal Reserve to leave key rates unchanged, investors will be looking for any indication of bias in favor of future tightening of monetary policy, traders said.

Share prices were also supported by the announcement of a new Cabinet Tuesday, marking the beginning of Japan’s new three-party government coalition.

``The successful creation of the coalition underscores the leadership of Prime Minister (Keizo) Obuchi,″ said Hideyuki Nakai, a senior investment manager at Nippon Global Securities.

``It also lowers the risk of short-term political instability and increases the likelihood of new economic stimulus measures.″

Volume on the first section was estimated at 461.75 million shares, up from 434.24 million shares Tuesday. Retreaters overwhelmed advancers 811 to 391 while 125 issues were unchanged.

The broader Tokyo Stock Price Index of all issues listed on the first section fell 5.92 points, or 0.39 percent, to 1,510.06. The TOPIX closed up 0.90 points, or 0.06 percent, on Monday.

In currency trading, the market reacted little to government comments that dollar-buying intervention by the Bank of Japan was unlikely in the near future.

Earlier Tuesday, the head of the Economic Planning Agency, Taichi Sakaiya, suggested that intervention in currency markets is not imminent because the yen may be stabilizing.

``So long as the dollar-yen rate remains stable around 105 yen or 106 yen, I do not expect immediate intervention,″ Sakaiya said.

Sakaiya also said, ``Steps will be taken against rapid moves in foreign exchange.″

Instead, traders said they will be watching closely the U.S. Federal Reserve’s Federal Open Market Committee Tuesday.

``The dollar-yen and euro-yen are being bought on dips and sold on highs by overseas profiteers ahead of the FOMC,″ said Takashi Toyohara, a senior foreign exchange dealer at Nomura Trust Bank.

In other currencies, the euro bought 113.90 yen late Tuesday, up 0.08 yen from its level of 113.82 yen late Monday.

The yield on the benchmark 10-year Japanese government bond rose to 1.6100 percent from Monday’s finish of 1.6050 percent. Its price fell 0.05 point to 100.78.

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