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

To: fut_trade who wrote (1265)	7/14/1998 9:32:00 AM
From: chirodoc	Respond to of 3902

Wake-Up Call: Good News Overseas Pushing Stocks Higher By Justin Lahart Senior Writer 7/14/98 9:18 AM ET Overseas markets continue to react favorably to the news out of Japan and Russia, and that is putting a good tone on U.S. stocks this morning. Though the market should open higher, it has some serious resistance to get through, according to Todd Clark, head of listed trading at Charles Schwab. "The thing I'm keying on is we have a triple top on the S&P futures at 1180 and that's what we need to get through to get this rally going again," he said. "I think we really need to get through that to see this thing carry." At 9 a.m. EDT, the S&P 500 futures were up 3.50 1172.10. That's 2.5 points above fair value and indicates a positive open. Dollar/yen is holding steady near the 141 level. After a couple of benign economic reports, the 30-year Treasury bond is up 9/32 to 106 16/32, dropping the yield to 5.67%. The June consumer rice index showed an increase of 0.1% in both the headline number and the core, which excludes the food and energy sectors. Economists expected the CPI to show gains of 0.2% in both. June retail sales increased by 0.1%, also as expected. Excluding auto sales they also gained 0.1% -- less than the 0.2% economists predicted. Japanese stocks again headed higher on hopes that the government will make bigger tax cuts than the market had expected. The Nikkei climbed 128.52 to close at 16,488.91. The head of the government's tax reform panel, Hiroshi Kato, said the government should cut income taxes by 4 trillion yen and corporate taxes by 2 trillion yen in the next fiscal year. The cuts will likely be larger than that -- opposition parties, which defeated the ruling Liberal Democratic Party so convincingly in Sunday's upper-house elections, offered larger tax cuts than the LDP. The LDP knows which way the wind blows. Still, trading was light, with investors holding back until it is clearer whom the LDP will choose to succeed Ryutaro Hashimoto as prime minister when it meets July 21. The two main contenders are Foreign Minister Keizo Obuchi and former Chief Cabinet Secretary Seiroku Kajiyama. In a Nihon Keizai Shimbun poll, business leaders overwhelmingly favored Kajiyama. Hong Kong stocks ended a three-day losing streak today, but the tone remains cautious ahead of Japan's prime minister selection. The Hang Seng climbed 79.73 to close at 8178.93.