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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: j g cordes who wrote (36109)	2/7/2002 3:05:14 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 68330

Japanese stocks hit 18-year low Financial Post - Wednesday February 6, 2002 Koizumi's support slips TOKYO - Confidence in the Japanese government suffered a blow yesterday as stocks hit an 18-year low, bond prices slumped and ratings agency Standard and Poor's Corp. downgraded seven major Japanese banks. "There's not one piece of good news out there," said Hirokazu Yuihama, senior strategist at Daiwa Institute of Research. "Foreigners are undoubtedly upset." The benchmark Nikkei average of 225 stocks shed 1.6% to 9475.60 in the fourth most active trading session this year, ending at its weakest since Dec. 15, 1983. The broader capital-weighted TOPIX index fared even worse, tumbling 1.8% to 926.27, a fresh 17-year low for the third day in a row. Traders said many institutions, including foreign investors, were dumping blue-chip issues such as Sony Corp. and Toyota Motor Corp. in large-lot orders due to disappointment over instability on the political front. Crumbling public support for Junichiro Koizumi, the Prime Minister, since his decision last week to sack Makiko Tanaka, the flamboyant pro-reform foreign minister, has raised fears that government restructuring will be delayed or scrapped altogether. A poll published in a Tokyo newspaper showed Mr. Koizumi's support had sunk to 58%, down 20 points from December. His popularity has been his main weapon against anti-reform forces within his own party. As it falls, so too does confidence in his government's ability to carry out reforms vowed by Mr. Koizumi last year to end Japan's decade of economic malaise. In a further blow to confidence, Standard & Poor's downgraded seven major banks and affirmed ratings on four others. It left all their long-term ratings on negative outlook. While some banks, including Mizuho Holdings Inc., bounced off record lows, brokers were soft across the board because the dim outlook for stocks bodes ill for their revenues. Nomura Holdings Inc., Japan's top broker, fell 4.5%. It dropped nearly 7% on Monday. Mizuho, the world's largest bank by assets, rose 3.5% after hitting an all-time low in early trade. But the modest bounce was dismissed as technical. In other markets, European shares tumbled yesterday after fresh worries about accounting standards and the latest high-tech profit warning from Ciena, although losses were pared by the close as U.S. markets recovered some poise. Finland's Nokia, the world's leading maker of mobile phones, was the biggest blue-chip faller after Elcoteq, a key supplier, forecast weak sales. Elcoteq shares tumbled 8.6%, while those of Nokia shed 7.2%. The FTSE Eurotop 300 index of pan-European blue chips finished 1.7% lower and the narrower DJ Euro Stoxx 50 index lost 2.3%. European banks were some of the hardest hit due to worries about undisclosed credit exposure and rising doubts that global equity markets will recover any time soon. Unknown exposure is what dragged Germany's top two banks, Deutsche Bank AG and the HVB Group, down between 3% and 4% each as worries mount about the health of German media empire Kirch Group. A downturn in global equity markets, meanwhile, pushed Credit Suisse down 4.1%, continuing a week-long slide that has seen its shares lose 15%. Shares in French software maker Dassault Systemes slipped 7.9% even though it reiterated targets set in October for 15% revenue growth this year and an operating margin of 30%. Some observers said the forecasts were too conservative given expectations of economic recovery in 2002, adding that the stock was overvalued. One positive standout was Dutch construction and services group Hollandsche Beton Groep NV, whose shares soared more than 50% after Spain's Dragados made a 756 million euros cash bid for the company. The proposed deal, priced at a premium of 57% over HBG's closing share price on Monday, dragged Dragados shares down 8.3%. London: The FTSE 100 index closed down 73.9 points or 1.4% at 5093.4. Frankfurt: By the close the blue-chip index was down 47.73 or 1% at 4936.75 points. Hong Kong: The benchmark Hang Seng index ended down 1.1% or 112.13 points at 10609.19. Tokyo: The benchmark Nikkei closed down 1.6% or 156.33 points at 9475.60. Sydney: The S&P/ASX 200 index closed down 14.6 points or 0.4% at 3451.5.