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Strategies & Market Trends : JAPAN-Nikkei-Time to go back up? -- Ignore unavailable to you. Want to Upgrade?

To: chirodoc who wrote (1256)	7/13/1998 3:54:00 AM
From: fut_trade	Read Replies (1) \| Respond to of 3902

Tokyo stocks end higher after PM says to resign TOKYO, July 13 (Reuters) - Tokyo stocks closed higher on Monday, paring early losses amid hopes that Prime Minister Ryutaro Hashimoto's planned resignation will prompt rapid policies to rescue Japan's recession-hit economy, dealers said. After his Liberal Democratic Party (LDP) suffered a disastrous election setback on Sunday, Hashimoto announced on Monday his intention to resign. The key Nikkei 225 average reversed its early downtrend and ended up 270.33 points, or 1.68 percent, at 16,360.39. It had dropped nearly two percent at one point in the morning. September Nikkei futures rose 260 points to 16,310. The Nikkei average posted a sharp retreat initially due to worries that the LDP setback may throw Japan's economic management into disarray, but it soon recovered. ''Market reaction to Hashimoto's step-down was positive, as the people turned their thumbs down and the market is now hoping for more speedy action on the economy.'' said Tsuyoshi Segawa, general manager at New Japan Securities Co Ltd. In elections for the Upper House of parliament on Sunday, the LDP won only 44 seats, opposed to the 61 it had held previously, and far short of 69 needed for a majority. Japanese media reports said a new prime minister was likely to be installed near the end of July in a special parliamentary sitting already scheduled to discuss measures to revive the country's ailing economy. While some initially said the setback could jeopardise economic policies -- including a bridge bank plan to help clear Japan's massive problem loans and proposed income tax cuts -- dealers said that the election might prompt dramatic change. ''The outcome presses home to the LDP that they've got to do more and do it more quickly,'' said Coen Kluyver, manager of foreign institutional sales at ING Baring Securities. Some dealers said there was talk that central bankers attending a Bank of International Settlements (BIS) meeting in Tokyo might come up with suggestions to speed Japan's reinvigoration of its economy. Turnover was light, 389 million shares changed hands on the first section of the Tokyo Stock Exchange (TSE), down sharply from 597 million shares on Friday. Broader indices also swung back and ended higher. The TOPIX index of all first-section shares was up 14.94 points, or 1.20 percent, at 1,256.44. The capitalisation-weighted Nikkei 300 was up 3.31 points, or 1.35 percent, at 248.70. Dealers were focusing on who would replace Hashimoto. Among the figures dealers and analysts saw as the next prime minister were Foreign Minister Keizo Obuchi or conservative veteran LDP politician Seiroku Kajiyama. ''Obuchi would be prompt sales and Kajiyama would prompt buying. That's how the stock market is looking at them now,'' said one broker at a second-tier Japanese securities house. Some said any appointment would bring stability to the markets, while others said Obuchi's lack of experience of economic management would fuel worries in the market. Kajiyama, on the other hand, is seen as having ability to propose policies to make the Japanese financial sector healthier, the dealer said. By sector, fisheries, ship building, rubber and iron/steel led gainers. The major losing sectors were gas, precision instruments and communications. Bank shares recovered sharply after they had been hit in the morning by worries over the future of a bridge bank plan. Bank of Tokyo-Mitsubishi (8315.T) was up 34 yen at 1,509, Sakura Bank (8314.T) was up 14 yen at 375 and Sumitomo Bank (8318.T) was up 46 yen at 1,406. The second section index finished 12.41 points lower at 1,342.69, with four million shares traded. The over-the-counter (OTC) index was down 2.70 points at 785.26.