Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

Tokyo market: Corporate slump threatens share gains

Jackie Kestenbaum,Yuzo Yamaguchi
Sunday 09 May 1999 00:02 BST
Comments

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

JAPAN'S benchmark stock index may pause in its rally in the coming week on concern that a retreat by US stocks and glum Japanese corporate earnings may stymie gains, investors said. That caution comes after the Nikkei topped 17,000 last week for the first time in 14 months.

Honda Motor, Fuji Photo Film, TDK and Shiseido are just some of 250 firms reporting results next week for the year ended March.

"Worries about 2000 earnings, continued poor macroeconomic data and the potential for the US market to continue to be weak aren't that supportive for the Japanese market," said Robert Howe, chief investment officer at AIMIC Investment Management, handling $2.5bn (pounds 1.5bn) in assets.

The benchmark Nikkei 225 stock average rose 1.5 per cent to 16,946.52 in a two-day trading week - Monday, Tuesday, Wednesday were national holidays - its fourth week of gains in six, leaving the benchmark up 22 per cent for the year.

Winston Barnes, senior equity manager at WestLB Securities Pacific, said: "It's a sell at 17,200, and a buy at 16,600. "The economic numbers have been horrendous, but people still want to play in the market." Overseas investors were net buyers of Japanese stocks in the week ended 23 April for the 14th week in a row, according to the Tokyo Stock Exchange. "The only factor to cause real volatility would be the US - particularly an interest-rate hike," said Joji Maki, who supervises Y50bn (pounds 260m) in equities at Nikko Asset Management.

US Federal Reserve Chairman Alan Greenspan said on Thursday that potential labour shortages and a runaway US stock market may stoke inflation. The policy-making Federal Open Market Committee next meets on 18 May.

Sakura Bank was the best performing stock in the Nikkei in the past two weeks, climbing 29 per cent to Y510, on expectation of a turnaround.

Japanese bonds are likely to rise next week amid confidence the government will not sell more debt to fund economic programs soon. "Bonds haven't hit the ceiling yet," said Takeshi Naito, a senior market economist at Daiwa SB Capital Markets.

Last week, the benchmark Number 212, 10-year bond rose 0.809, or Y405 per 50,000-yen bond, to 101.648. The yield fell 9 basis points to 1.315 per cent.

"I can't be bearish," said Masahiro Kami, the chief fund manager at Daiwa SB Investments. "It's dangerous to sell bonds now, thinking the ceiling will be there."

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in