The world stock rout triggered by steep U.S. stock falls earlier this month demonstrates the globalization of economic activity with the U.S. economy at the center.

A key downside factor was a higher-than-expected rise in U.S. consumer prices, which aroused concern about inflation and interest rate hikes by the U.S. Federal Reserve.

After having bottomed out in October 1998, the Tokyo stock market had since continued a steady climb until it tumbled last week.

The market reacted positively to a series of fiscal spending steps in general and the zero interest rate policy the Bank of Japan started in February 1999 in particular.

The advent of Internet-related companies, a key reason for the current U.S. economic prosperity, is now drawing the attention of investors in Japan as well.

A key demoralizing factor now is an end to the ultraeasy money policy, as signaled by BOJ Gov. Masaru Hayami.

The world stock volatility has put info-tech stocks, especially Net-related issues, under severe selling pressure.

Needless to say, investors will thus now pay greater attention to corporate earnings when stock trading dependent on surplus funds comes to an end.

The Tokyo market could repeat ups and downs on a high plateau for a while and subsequently enter an adjustment phase before starting an earnest ascent this summer.