Stocks Slightly Higher in Tokyo
Mar. 20, 1998
TOKYO (AP) _ Stocks rose early Friday, recovering from an early drop after news of huge derivatives losses by a major Japanese beverage company. The dollar edged higher against the yen.
The Nikkei Stock Average, which lost more than 200 points in early trading, recovered to gain 23.28 points, or 0.14 percent, to 16,702.30 by midday. On Thursday, the average rose 59.34 points, or 0.36 percent.
But the Tokyo Stock Price Index of all issues listed on the exchange's first section drifted lower to 1,247.84, a decline of 1.73 points, or 0.14 percent. The TOPIX closed down 3.52 points, or 0.36 percent, the day before.
Word that beverage company Yakult Honsha Co. lost 105.7 billion yen ($813 million) from trading in currency derivatives and other speculative financial transactions weighed on the market.
But the main stock index rebounded from early lows after institutional investors began buying Nikkei future contracts.
Still, investors remained discouraged by a growing perception that an upcoming government economic stimulus package will not include major income-tax cuts. The ruling Liberal Democratic Party is expected to unveil a comprehensive package later this month.
On the foreign exchange market, the dollar traded little changed from where it left off in Tokyo on Thursday, but was well below levels reached in New York trading.
The dollar bought 129.87 yen as of midday Friday, up just 0.01 yen from late Thursday in Tokyo but lower than its late New York rate of 130.70 yen.
In early Tokyo trading, the dollar rose above 131 yen for the first time since Jan. 14. But it then rapidly lost ground against the yen amid suspected intervention by the Bank of Japan.
The yield on the benchmark No. 182 10-year Japanese government bond rose to 1.535 percent from Thursday's finish of 1.520 percent, driving its price down to 109.84 from 109.95.