clock menu more-arrow no yes

Filed under:

STOCK MARKET IN JAPAN SOARS IN HEAVY TRADING

Japanese stock prices soared Wednesday as fears of higher interest rates and a strong yen receded. The dollar rebounded against the yen.

An overnight rally in U.S. stock and bond markets also encouraged a buying spree that took many market participants by surprise.The market's barometer index, the Nikkei Stock Average, surged 3.54 percent higher to 22,055.96 points in its biggest one-day climb so far this year - 754.92 points.

The last time the index gained more in one day was last July 7, when it added 956.19 points. Despite the strong showing, the Nikkei remained below its high for the year of 22,235.03, set on April 26.

"People were assuming it would be quiet, but once the market started moving everyone started chasing it," said Paul Migliorato, senior salesman at Jardine Fleming Securities.

Trading volume was heavy, with 500 million shares changing hands on the first section, up sharply from 291.0 million Tuesday.

Stocks of big companies scored big gains, but the solid buying support lifted most stocks on the exchange. Advances swamped declines 1,038 to 114, while 84 issues were unchanged.

The Tokyo Stock Price Index of all issues listed on the exchange's first section climbed 38.15 points, or 2.31 percent, to 1,690.16. It had gained 8.91 points, or 0.54 percent, the previous day.

Many cited the advance of the dollar against the yen, which eases pressure on Japan's exporters, as a big factor encouraging investors.

Concerns about a possible rise in Japanese interest rates also were eased when a senior Ministry of Finance official suggested that Japan's central bank was not about to raise the rates any time soon.