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Tokyo Stocks Rise Sharply

September 24, 1998

TOKYO (AP) _ Japanese stock prices rose sharply Thursday morning on hopes the U.S. Federal Reserve will soon cut interest rates to help ease the global economic crisis. The U.S. dollar moved higher against the yen.

The Nikkei Stock Average surged 379.31 points, or 2.75 percent, to 14,169.12 points at the end of the morning session. On Tuesday, the index gained 192.51 points, or 1.42 percent.

The dollar bought 136.48 yen in midday trading, up 1.34 yen from late Tuesday in Tokyo and also above its level of 135.75 yen in New York.

Financial markets in Tokyo were closed Wednesday for a national holiday.

Traders said stock prices started higher Thursday as investors were cheered by Federal Reserve Chairman Alan Greenspan’s signal that U.S. interest rates may be lowered.

Greenspan testified Wednesday before the U.S. Senate Budget Committee that Fed policy-makers are fully aware of the widening financial crisis that has spread from Asia to the rest of the world.

That was the clearest indication yet that rates will be lowered. The Fed’s policy-making committee meets next Tuesday.

Following the Fed chairman’s comments, the Dow Jones industrial average surged to 8,154.41 at Wednesday’s close, its highest finish in a month. More than half of the 257.21-point gain came during the final hour of trading.

On the foreign exchange market, the dollar held its strength against the yen amid lingering uncertainties over a stalemate between Japan’s ruling and opposition parties over bills to rescue troubled financial institutions.

The Tokyo Stock Price Index of all shares listed on the first section was up 27.62 points, or 2.63 percent, to 1,077.79. The TOPIX rose 2.38 points, or 0.23 percent, Tuesday.

Meanwhile, the yield on the 10-year Japanese government bond stood at 0.900 percent, unchanged from Tuesday’s finish. Its price remained unchanged at 108.04 yen.

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