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To: Glenn McDougall who wrote (5693)	7/24/1998 12:11:00 AM
From: pat mudge	Respond to of 18016

Reason for today's drop: <<< FRIDAY JULY 24 1998ÿÿAsia-Pacificÿ Japan may face rating setback By Paul Abrahams and Michiyo Nakamoto in Tokyo <Picture: Moody's>Moody's, the US credit rating agency, yesterday said it was considering downgrading securities issued or backed by the Japanese government. A decision to take away Japan's Aaa status, the highest awarded by the agency, would deliver a blow to the nation's prestige. It would make Japan, the world's largest creditor, the only member of the Group of Seven leading industrialised nations not to have an Aaa rating. Although the US company's move will not necessarily result in a cut, it does begin a formal review process, and comes at a critical moment for Japan - it is suffering from its worst recession in more than 50 years, and is effectively leaderless. The ruling Liberal Democratic Party will today choose a new party president and prime minister to replace Ryutaro Hashimoto. He decided early last week to stand down after the LDP's poor showing in upper house elections. Moody's announcement triggered a fall in equity markets across Asia. The yen dropped from Y140 against the dollar to Y141.85 in late Tokyo trading, while the benchmark Nikkei 225 average tumbled 105 points, or 0.6 per cent, to 16,188. In Hong Kong, the Hang Seng average slid 2.9 per cent, while in Thailand the SET index declined 3.6 per cent. The US rating agency's decision brought a sharp response from the Japanese authorities. Hikaru Matsunaga, finance minister, said he could not understand the reasons for Moody's possible downgrade. "Japan has a vast amount of foreign assets, enormous foreign reserves. Japan's fundamentals are firm, and this is merely a temporary economic downturn," he said. Moody's said its move had been prompted by the disarray among Japanese policy-makers in deciding a medium-term strategy to deal with the deep structural problems afflicting the economy. Another problem was that Japan's fiscal deficit - unlike those of most other highly rated nations - was likely to deteriorate. Finally, there was a danger that Japanese residents might take advantage of the "big bang" reforms to shift funds suddenly into foreign assets. The LDP's disarray was evident yesterday when a number of members of parliament threatened to leave the party if Keizo Obuchi won the party leadership. Mr Obuchi, foreign minister, appears to be the front-runner in the contest against Seiroku Kajiyama, a former chief cabinet secretary, and Junichiro Koizumi, health minister.<<<< Anyone have an update on the Japanese elections? Pat

To: Glenn McDougall who wrote (5693)	7/24/1998 12:24:00 AM
From: pat mudge	Read Replies (1) \| Respond to of 18016

Check out Lucent's numbers for international sales: THURSDAY JULY 23 1998ÿÿTelecomsÿ LUCENT: Company lifted by technology boom By Roger Taylor in San Francisco Lucent Technologies, the world's largest maker of telephone equipment, more than doubled profits before charges in its third quarter. It was helped by international expansion and the rapid growth of integrated telephone networks capable of handling both voice calls and data. Excluding $668m in one-off charges, net income rose to $435m, compared with $213m for the same period last year. Earnings per share were 32 cents, up from 17 cents and well ahead of Wall Street forecasts of 27 cents. The better-than-expected results come after a sharp rise in Lucent's share price, which has increased more than six-fold since the company was spun out of AT&T two years ago. The business is now worth about $133bn - substantially more than its former parent. Lucent's shares rose « to 102 5/8 in early trading yesterday - against the market trend. The rise has been driven by the boom in telephone technology, including the growth of mobile phones and, more recently, the explosive growth of the internet. This is creating demand from telephone companies for data networking equipment used to manage internet traffic, e-mail, video-on-demand and the wide range of new uses to which telephone lines are being put. Lucent has also benefited from rapid international expansion. Currently, the company has only about 3 per cent of the market outside the US but is growing fast. International growth rates were twice those inside the US for most product areas. As a result, revenues grew 14 per cent to $7.2bn for the three months to June 30. The $668m in one-off charges mainly relate to Lucent's recent acquisitions of businesses that specialise in data networking equipment. They left the company with a loss of $232m for the quarter, or 17 cents a share. Lucent has identified the fast growing market for data networking equipment as central to future growth, but faces stiff opposition from the computer companies that originally developed the technology, such as Cisco Systems. Bill O'Shea, head of Lucent's data networking division, said he believed the market potential was worth up to $50bn and that this would double by 2002. Lucent has bought a string of companies over the last year, including Prominet, Livingstone Enterprises, Yurie Systems and Lannet, in order to build up its expertise in data networking, reflecting the need for telephone equipment companies to be able to offer these new technologies.>>>>