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Market’s Key Index Gains After Four-Day Fall, Dollar Declines

March 17, 1992

TOKYO (AP) _ The Tokyo Stock Exchange’s best-known index gained slightly in volatile trading today after a four-day fall took it to its lowest close in five years. The dollar declined against the Japanese yen.

The 225-issue Nikkei Stock Average gained 80.47 points, or 0.41 percent, closing at 19,917.63, but declining issues outnumbered advances 728 to 271, with 121 issues remained unchanged.

In the previous four trading days, the Nikkei dropped a total of 1,017.43 points, including 618.90 points on Monday, when it closed at 19,837.16, its lowest close since 19,531.52 on Feb. 16, 1987.

The Tokyo Stock Price Index of all issues listed on the first section fell another 10.99 points, or 0.76 percent, to 1,433.87. It was down 19.14 points Monday.

An estimated 350 million shares changed hands, up from Monday’s 240 million.

″The Nikkei average remains unstable,″ said Yutaka Ishida, a trader with Daiwa Securities.

While individual investors took advantage of low prices to buy, institutional investors continued selling to settle accounts for the fiscal year ending March 31, Ishida said.

He said today’s turnover was boosted by cross trading among corporate investors for year-end accounts.

Early today, the Nikkei almost regained the 20,000 level. It fell back and then rebounded in the afternoon on arbitrage buying.

Prime Minister Kiichi Miyazawa and Finance Minister Tsutomu Hata blamed Monday’s plunge largely on fiscal year-end factors.

At an upper house Budget Committee session, Miyazawa said the fiscal 1992 national budget contains several measures to stimulate the economy. He said the government would do its best ″not to cool off the attitude of businesses and investors any further.″

Hata told the same committee that a series of brokerage scandals since last year, declining corporate profits and uncertainty about Japan’s economy were among reasons for the recent stock market weakness.

In a news conference, Hata also called the yen’s recent weakness undesirable and said the Group of Seven industrialized countries could intervene if the yen remained unstable.

The dollar closed at 133.32 yen, down 0.98 yen from Monday’s close and also below its overnight finish of 133.90 yen in New York.

After opening at 133.75 yen, it ranged between 133.10 yen and 133.93 yen. Spot trading totaled $8.24 billion, up from Monday’s $6.80 billion.

Yukio Matsunaga, an exchange dealer with Industrial Bank of Japan, said the dollar underwent a minor correction after recent gains.

As Japan’s economic fundamentals are fairly firm, the Nikkei average’s rebound made it difficult for traders to find any reason to sell the yen, Matsunaga said.

The benchmark No. 129 10-year Japanese government bonds closed at 105.66 points, up from Monday’s 105.42-point finish. Their yield fell to 5.385 percent from 5.425 percent.

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