Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 17, 1992 TAG: 9203170084
SECTION: BUSINESS PAGE: A-5 EDITION: METRO
SOURCE: Associated Press
DATELINE: TOKYO LENGTH: Medium
But the panic selling some analysts had predicted failed to materialize.
Much of the decline in the 225-issue Nikkei Stock Average was attributed to year-end selling by investment trusts. Monday was the last trading day for trusts for the fiscal year that ends March 31.
Finance Minister Tsutomu Hata said signs of improvement in the stagnant Japanese economy were setting the stage for the market's recovery.
The index plunged 618.90 points, or 3.03 percent, closing at 19,837.16, lowest since 19,531.52 on Feb. 16, 1987.
The Tokyo Stock Price Index of all issues listed on the exchange's first section fell 19.14 points, or 1.30 percent, to 1,444.86. On Friday, the TOPIX fell 8.21 points, or 0.56 percent.
On Friday, selling by investors pessimistic about the outlook for Japan's economy pushed the market to a 17-month low of 20,168.15, down 393.73 points, but prices rebounded to 20,248.52 as financial institutions stepped in to support the market.
The Nikkei average already has lost almost half its value since an economic boom sent the market soaring to a peak of 38,915.87 at the end of 1989.
Most damage was done in a spectacular bust in early 1990. But since then, prices have drifted lower, and the average has hovered close to 20,000 for the past two months.
The 20,000 mark was seen as psychologically important by analysts, some of whom believed a panic would set in once the Nikkei fell below that milestone.
But analysts said Monday that most investors were waiting for prices to bottom out before they began hunting bargains.
"I'd be a lot more worried if I'd seen massive selling," said Adrian Tschoegl, chief economist at SBCI Securities. "Those people who want to sell had to offer a pretty good price to induce people to buy."
Hata urged brokers and corporations to work to instill trust in the market after recent scandals, such as disclosures that major brokerages were compensating major clients for investment losses, leaving small investors unprotected.
by CNB