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Tokyo slips after recent gains
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February 17, 1999: 5:28 a.m. ET
The Nikkei loses ground on bond worries following four days of gains
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LONDON (CNNfn) - After four straight days of gains, Tokyo finished fractionally lower Wednesday following a mixed day on Wall Street.
The Nikkei 225 index of leading shares closed the day down just 0.52 percent lower at 14,158.67. The nation's banks were behind much of the selling, taking advantage of the four-day buying spree to start unwinding their cross-shareholdings, shares held in other companies, ahead of the fiscal year-end on March 31.
"There was a lot of buying in the morning but it was hard for the market to move past the unwinding of cross-shareholdings," Kazuhiro Nomura, head of equity trading at Paribas Capital Markets told Reuters.
Sentiment was also dented as the implications of the oversupply in the long-term debt market sank in. Much of Tuesday's rally came on the back of the Japanese government's about-face on policy, when it said it would act to cut the number of long-term bonds it planned to put on the market over the coming months. Strategists are now arguing that the measures will not do enough to address the oversupply.
Among the biggest gainers Wednesday were export-oriented stocks, as the yen continued to weaken against the dollar. Electronics giant Pioneer jumped more than 6 percent to 2,115 yen. Canon gained 4 percent to 2,600, Sony Corp. added 2.79 percent to reach 8,840 and Fuji Photo Film was up 2.63 percent to 4,300. Tire makers also benefited from a weakening yen, with Bridgestone Corp. putting on more than 4 percent on top of a strong push Tuesday, to end the day at 2,565 yen.
Auto stocks also gained on the weakness of the yen as it moved to around 118 against the dollar, although continuing speculation about global consolidation also played a role. The sector gained 0.79 percent. Mitsubishi Motor was the strongest performer, up 5.7 percent to 371. Honda Motors rose 2.36 percent to finish the day at 4,330.
Sydney shrugged off two days of losses to finish the day as the region's only gainer. The All Ordinaries was slightly higher, up 0.8 percent at 2,882.2.
A series of strong corporate results helped offset the impact of weaker commodities prices overnight. Telecommunications giant Telstra Corp. bounced back after losses Tuesday to finish up 3.18 percent at A$8.47.
Manila had another quiet day as Chinese New Year kept investors away. Trading was thin and the Composite index ended the day 0.02 percent lower at 1,918.57.
The holiday spirit also spilled over into Jakarta, where the index of leading shares ended the day 0.22 percent lower at 397.975.
The biggest fall was in Bangkok were the index of leading shares lost 3.52 percent to close at 338.02. Overseas investors are staying on the sidelines until the full extent of financial reforms becomes clear.
Hong Kong, Singapore, Malaysia and Korea remained closed for the Chinese New Year holiday.
-- from staff and wire reports
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