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Tokyo's Stock Indexes Surge

Posted on: Wednesday, 17 March 2004, 06:00 CST

TOKYO - Tokyo's stock indexes surged Wednesday, with the broader benchmark hitting a 31-month high following Wall Street's overnight gains. The U.S. dollar fell sharply against the Japanese yen.

The Nikkei Stock Average of 225 issues closed up 194.57 points, or 1.73 percent, at 11,436.86 points. On Tuesday, the index fell 75.61 points, or 0.67 percent.

The broad index of all issues on the Tokyo Stock Exchange's first section advanced 20.75 points, or 1.85 percent, to 1,141.71 - the TOPIX's highest close since Aug. 28, 2001, when it finished at 1,150.25. The TOPIX lost 3.96 points, or 0.35 percent, the day before.

The dollar bought 108.27 yen at 5 p.m. Wednesday, down 1.35 yen from late Tuesday in Tokyo and also below the 108.78 yen it bought in New York later that day. It clung to a range between 108.17 yen and 108.98 yen in Tokyo on Wednesday.

On the stock market, investors bought technology and other exporter issues as they welcomed U.S. stock gains, while ignoring the dollar's drop overnight against the yen. A stronger yen usually hurts exporter issues because it makes their products more expensive abroad and cuts into their overseas profits.

Internet investor Softbank and technology issues such as Advantest, Canon and Tokyo Electron gained on Wednesday. Automakers Honda Motor, Nissan and Toyota, and major banks Mizuho Financial and Sumitomo Mitsui Financial also rose.

Wall Street rebound Tuesday as bargain hunters picked up stocks battered by a week of heavy losses.

The Dow Jones industrial average rose 81.78, or 0.8 percent, to 10,184.67. The tech-heavy Nasdaq composite index gained 3.89, or 0.2 percent, to 1,943.09.

The U.S. currency weakened in Tokyo amid growing suspicion that Japanese authorities may be easing up on large-scale intervention.

The dollar's overnight fall below 109.50 yen, a level traders had assumed that Tokyo would defend, fueled speculation that Japan's Finance Ministry would refrain from curbing the yen's strength for now. In New York overnight, the currency hit a three-month low as it fell as low as 108.65 yen, a level not seen since late February.

In other currencies, the dollar's slide against the yen also pushed down European currencies against both the yen and the dollar.

The euro bought $1.2222 late Wednesday in Tokyo, down from $1.2337 late Tuesday. Against the yen, the European currency was quoted at 132.18 yen, down from 135.16 yen.

The yield on Japan's benchmark 10-year government bond rose to 1.3100 percent from 1.2850 percent late Tuesday. Its price fell 0.22 to 99.91 points.

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On the Net:

Tokyo Stock Exchange: http://www.tse.or.jp

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