Stocks Surge, Dollar Edges Lower
TOKYO (AP) _ Tokyo share prices surged in heavy trading today, led by bank stocks and issues related to post-quake rebuilding. The dollar edged lower against the yen.
The 225-issue Nikkei Stock Average rose 648.53 points, or 3.58 percent, closing at 18,752.88. On Friday, the index had risen 33.51 points, or 0.19 percent, to 18,104.35.
Advancing issues swamped decliners 840 to 242, with 95 issues unchanged.
The Tokyo exchange suspended trading in futures and options contracts on the TOPIX index for 15 minutes in the early afternoon because of the rapid climb in prices of those contracts. It was the first time that trading in TOPIX index contracts was ever halted.
An estimated 650 million shares changed hands on the first section, up from Friday’s 497 million shares. Today’s turnover was the largest for a full-day session since June 10, 1994, when 1 billion shares changed hands.
The Tokyo Stock Price Index of all issues listed on the first section was up 53.63 points, or 3.80 percent, to 1,466.46. The TOPIX had lost 2.78 points, or 0.20 percent, to 1,412.83 on Friday.
Individual investors who had sold shares a week ago bought back on credit, especially construction stocks, said Hideo Sugai, deputy general manager of the stock information department at Yamaichi Securities.
On Jan. 23, the Nikkei average had shed 1,054.73 points, the steepest fall since Sept. 26, 1990, when the index fell 1,108.70, in response to the Jan. 17 earthquake.
The 7.2-magnitude earthquake killed more than 5,000 people and severely damaged the Kobe port, the nation’s largest container port. Estimates for rebulding costs range between about $70 billion and $90 billion.
``Market players now are looking more positively to the rehabilitation of the earthquake-stricken city,″ said Kenjiro Takemiya, an analyst with Okasan Securities. said.
Banking stocks, including Sumitomo Bank, which disclosed Friday that it will expect a $2.8 billion pretax loss in the current fiscal year to write off non-performing assets, rose broadly.
Traders said the disclosure reassured investors. Japanese banks have held bad loans extended lavishly during Japan’s booming economy in the late 1980s, but failed to recover under the sluggish economy that followed.
The dollar was changing hands at 99.18 yen at 3:30 p.m. (1:30 a.m. EST), down 0.17 yen from late Friday Tokyo level, and below its Friday’s late New York at 99.25 yen.
The dollar was quoted in early Tokyo trading at 99.08 yen, and traded between 99.05 yen and 99.32 yen during the day’s trading.
Many players avoided making major moves ahead of a two-day meeting of the U.S. Federal Reserve Board’s policy panel starting Tuesday. Traders expect the Fed to raise interest rates to keep inflation from accelerating.
The benchmark No. 164 10-year Japanese government bonds were quoted at 96.48 yen at late today, unchanged from Friday’s close. Their yield remained unchanged at 4.660 percent.