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

To: Step1 who wrote (1674)	1/12/1999 11:48:00 PM
From: borb	Respond to of 3902

Correct. Unfortunately, there is no other good news for Nikkei or Japan related products.

To: Step1 who wrote (1674)	1/15/1999 12:33:00 AM
From: borb	Respond to of 3902

TOKYO, Jan 15 (Reuters) - Fund repatriation and a slowdown of private capital outflows will keep up pressure on the dollar with the approach of corporate Japan's book closings for the March 31 end of the financial year, currency analysts and dealers say. Such repatriation could accelerate if monetary authorities are unable to stave off another climb by the yen. But a dramatic dollar sell-off for yen by Japan's institutional investors will averted as monetary authorities here have signalled that they would act to halt a sharp appreciation of their currency, they said. ''In the short run, repatriation of funds will keep pressure on the dollar. But the dollar's downside will be supported by intervention, which will alleviate the pressure to desperately sell off overseas assets,'' said Taisuke Tanaka, director and strategist of global foreign exchange at Credit Suisse First Boston. Saddled with massive non-performing loans, Japanese banks are under pressure to reduce overseas assets as they attempt to restore the health of their balance sheets. Last October, Daiwa Bank and Mitsui Trust and Banking both announced a complete withdrawal from overseas operations, bringing to a total of five institutions which have reverted to solely domestic operations in the past two years. Even the healthier financial institutions have scaled back their overseas operations, consolidating branches and staff, and further reducing assets. ''It's difficult to assess the situation. But the stronger financial institutions are probably discreetly disposing of such assets,'' CSFB's Tanaka said. The Japanese government has encouraged banks to reduce their overseas assets as they undergo restructuring. Such moves may accelerate as the government plans to inject public funds into banks as early as late January. ''Banks are currently planning which assets to liquidate. So a concentrated effort to reduce overseas assets could come,'' an economist at a major Japanese financial institution said. The latest turn of global financial events such as Brazil's devaluation is unlikely to pose a significant threat to Japanese banks, analysts said. Japanese banks' exposure to Brazil stood at roughly $5 billion, far below Europe's $44 billion and the United States' $17 billion, according to figures from the Bank for International Settlements. But others said it was too early at this stage to assess the risks to global financial markets stemming from Brazil's troubles, and the investment picture could change. Meanwhile, private capital outflows declined last last year amid the appreciating yen and surging Japanese government bond yields. Net purchases of foreign bonds, on a contract basis, stood at 970.4 billion yen ($8.51 billion) in December, down from 1.6762 trillion yen a month earlier, according to the Ministry of Finance. Foreign bond investments customarily decrease in the run-up to the end of the fiscal year in March. In particular, Japanese banks saw net selling of foreign bonds worth 184.6 billion yen in December. Currency market participants also noted that major investors such as Japanese life insurers were yet to sell off their overseas assets in the recent rise by the yen. ''If the yen had appreciated beyond 110 yen -- to 105 or low 100 yen levels -- it would have induced heavy sales of overseas assets,'' said an analyst at a major Japanese commercial bank. A senior dealer at a Japanese brokerage added: ''I don't think the major Japanese institutional investors are going to actively shift their foreign investment portfolios before March, because the losses could be too great.'' ($1=114 yen)

To: Step1 who wrote (1674)	2/7/1999 6:19:00 PM
From: FACTUAL	Read Replies (1) \| Respond to of 3902

Just returned from another business trip to Japan. Not much has changed in the corporate sector as they continue to deploy capital in lower return projects, the major companies intent on copying products from America ( generally from Cisco, Ascend etc ). While bank disclosure appears to have improved, direct financing of JGB from BOJ appears to be gaining steam. If the corporates are destroying equity with low return investments and the government continues deficit spending, that is a prescription for sliding into bankruptcy albeit slowly given the size of Japan's resources. Very little to be excited about.