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Stocks Slide, Dollar Drops

November 11, 1996

TOKYO (AP) _ Profit-taking on earlier gains helped push share prices down in Tokyo Monday, as the dollar also fell against the Japanese yen.

The 225-issue Nikkei Stock Average closed at 21,065.08 points, down 135.96 points, or 0.64 percent, from Friday’s finish at 21,201.04. On Friday, the average jumped 429.93 points, or 2.07 percent.

The broader Tokyo Stock Price Index of all issues listed on the first section was down 3.82 points, or 0.24 percent, to 1,572.83. The TOPIX rose 14.66 points Friday.

Traders said share prices retreated on profit-taking after initial gains.

Tomio Uchida, manager of the equity division at Cosmo Securities, said incentives are lacking to push share prices higher. But the Nikkei average was supported above 21,000 because domestic investors will buy shares below that level, he said.

On the foreign exchange market, the dollar was stuck in a narrow range in quiet trading, dealers said.

The dollar was changing hands at 111.52 yen, down 0.61 yen from its late Friday level of 112.13 yen in Tokyo. In late Friday trading in New York, it was quoted at 111.50 yen.

Players moved to sell the dollar as it neared 112 yen, but strong buying interest by Japanese importers and investors was providing support, traders said.

Dealers were also finding it difficult to make moves ahead of market closures in the United States and Singapore on Monday for holidays.

The market was still trying to grapple with the implications of a series of comments made by officials from Japan’s Ministry of Finance last week.

A remark Thursday by Eisuke Sakakibara, head of the ministry’s international finance bureau, that he had no thoughts of guiding the yen lower sent the dollar tumbling 2 percent against the yen.

``Now people are trying to get an idea of what a good level for the dollar is,′ said Akira Kase, general manager of foreign exchange management and trading at Marubeni Corp.

The benchmark No. 182 10-year Japanese government bond was quoted at 101.84 yen, down from Friday’s close of 102.06 yen. Its yield rose to 2.740 percent from 2.710 percent.

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