Stocks, Dollar Rise in Tokyo
TOKYO (AP) _ Stock prices seesawed today but managed to finish with a moderate gain, ending a week of heavy losses on an up-note.
The Nikkei index of 225 selected issues, which had lost nearly 6 percent Thursday before rebounding to end the day with a 3.1 percent loss, gained 1.77 percent today. The index added 528.82 points to close the week at 30,372.16.
The Nikkei had fallen 2,773.1 points during the three previous trading days. The stock market was closed Wednesday for a national holiday.
Volume on the market’s first section was estimated at 600 million shares, up from 580 million shares on Thursday.
The Nikkei fell in early morning trading as institutional investors overwhelmed the market with sell orders, securities dealers said.
But the index rose sharply toward end of the day, lifted by fresh interest in stock futures by arbitrageurs, traders said. Arbitrageurs rely on computerized program trading, often criticized for contributing to downward spirals in stock prices, to profit from price differentials between the futures and the underlying stocks.
″The market is slowly but gradually recovering, helped by relative stability in the currency and bond markets,″ said Akira Shimoda, an equity analyst with Yamaichi Securities.
Shomoda said the Finance Ministry’s approval Thursday of a measure that allows Japan’s four major brokerage houses to handle more than 30 percent of the purchase orders of any particular stock in a month would ″greatly help″ the securites firms and strengthen the market.
The firms - Nomura Securitiies, Daiwa Securities, Nikko Securities and Yamaichi Securities - had asked the Finance Ministry to ease the restriction, a rule set up to check insider trading.
The four firms account for about half of the market’s total volume, a market analyst said.
In the currency market, the dollar closed the week at 155.07 yen, up 0.24 yen from Thursday’s close of 154.83 yen.
″The demand for the dollar basically remains strong,″ said Toshio Takahashi, a dealer with the Industrial Bank of Japan. ″The American economy is good, despite cautiousness over inflation″ among U.S. monetary authorities, he said.
Finance Minister Ryutaro Hashimoto was to leave later today for a weekend meeting focusing on exchange-rate movements with Treasury Secretary Nicholas Brady in Los Angeles.
Hashimoto told a parliamentary budget committee session today that he will seek U.S. cooperation in keeping currencies stable within the framework of policy coordination among the Group of Seven major industrialized countries.