Asia Treads Softly As West Takes Nap
The Age
Saturday April 22, 2000
It was a case of almost all quiet on the eastern front yesterday as traders in a handful of Asian markets provided the only financial direction, with most Western stock exchanges closed for the Easter holidays.
Japan's broad Topix Index rose for a fourth day, led by NTT DoCoMo and other stocks due to join the Nikkei 225 Stock Average on Monday, as Nikkei tracker funds rushed to buy them.
But the benchmark Nikkei fell as funds sold the 30 stocks that will be removed from the indicator to raise money to buy the new members. The Nikkei ended down 706.64 points, or 3.73per cent, at 18,252.68.
``The market is all about the Nikkei reshuffle," said Yasuhiro Shinbayashi, joint general manager at Tokai Asset Management Co. ``We'd been complaining the Nikkei is composed of old companies, but the Nikkei didn't have to make such a radical change, which is causing trouble for some people."
The Topix Index of all stocks on the Tokyo Stock Exchange's first section rose 21.41 points, or 1.3per cent, to 1650.41.
Investors were spooked by further signs that the domestic economy was still weak, with Japan's three largest department stores saying their annual results confirmed a sales decline in the 12 months to February29.
Shares in Takashimaya, Japan's largest department store operator, fell as much as 2.2per cent, while Mitsukoshi, its closest rival, declined as much as 3.4per cent. Shares in Daimaru retreated as much as 1.2per cent.
Japanese bonds were little changed as investors shunned yields near an 11-week low and as the central bank reiterated yesterday it might raise rates if the economy improved. Benchmark bond yields are still near the 1.7per cent level that Finance Minister Kiichi Miyazawa called ``abnormal" in February.
Taiwanese Internet-related stocks such as Systex extended their declines as falling prices for such companies in the United States raised questions about the value of their Taiwan counterparts.
Taiwan's OTC Index fell 0.56of a point to 288.22, while elsewhere in the region South Korea's Kospi 200 Index rose 0.57 of a point to 96.43 and the Kuala Lumpur Composite Index lost 0.5 of a point to 894.77. -- with BLOOMBERG
© 2000 The Age
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