Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (116784)	8/13/2001 7:05:21 AM
From: rolatzi	Read Replies (1) \| Respond to of 436258

Yes, I saw that they may buy US$ to force down the yen. Even more ominous was this article about today's drop in the Nikkei: Asia Markets-Japan stocks hit 16-yr low, currencies firm By Anchalee Worrachate SINGAPORE, Aug 13 (Reuters) - Asian assets painted a mixed picture on Monday -- a 16-year closing low for Tokyo's benchmark stock index set the tone for Asian equities while currencies firmed against the dollar. Tokyo's benchmark Nikkei average ended at 11,477.56, down 2.19 percent on the day after profit warnings from Advantest Corp and Rohm Co Ltd . The companies issued the warnings after the Japanese market closed on Friday, but their share prices took the hit on Monday. Hong Kong stocks closed at their worst level in 28 months, weighed by fears about Hutchison's Whampoa's European investments. The Hang Seng Index (^HSI - news) ended down 0.61 percent at 11,694.29 and has now shed 22.5 percent so far this year, making it the worst performing benchmark index in Asia. South Korean shares, meanwhile, finished higher after sharp gains in builders and financial stocks helped the key index recoup some lost ground. Most Asian currencies tracked the yen higher, with the Indonesian rupiah racking up a 5.5-percent gain at one point on the back of central-bank intervention and optimism over the new cabinet. Analysts see the yen strengthening further against the dollar in the near-term and said it might take regional currencies along for the ride, although longer term many believe the yen will trend lower because of Japan's huge debt load. ``It can get through 120. Actually, it looks like 118-119 should be a good support for the dollar/yen. We are still seeing the yen repatriation story ahead of half-year end,'' said Steve Brice, global market economist at Standard Chartered in Singapore. NOT ALL GLOOM AND DOOM Despite Japan's grim economic picture, Merrill Lynch believes the country is poised for an export-led recovery from early next year. Merrill said in its report the latest data suggested inventories were finally beginning to fall and the worst part of the cyclical downturn -- when profits were squeezed by both production cutbacks and rising inventories -- appeared to be over. ``Of course, this does not mean that a new output growth cycle is about to start. Between now and the end of this year, the demand side remains too weak for that. All components of domestic demand...are poised to deteriorate further in coming months,'' the report said. ``However, if, as we suspect, the inventory rundown continues smoothly from here, the downward pressure on corporate profits should already start to ease-off,'' it said. Once a U.S. recovery starts gaining momentum early next year, Merrill predicted that Japanese manufacturers should see solid increases in global market share and the economy will grow again. ``For 2002, we forecast 1.2-percent real GDP growth, led by exports rising 11 percent. After the expected contraction of 0.5 percent in this year's GDP, the pick-up should be strong enough to push up corporate profits by 38 percent next year,'' it said. Don't they have that backwards? The US$ has to decline, the US consumer has to retrench and the Japanese consumer has to start spending. It's unbelievable that Merrill predicts a recovery in the US to lead a recovery in Japan. rolatzi