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The Tokyo stock market appears poised to stage a rebound after confirming a double bottom.

Currently, low- and midpriced issues dependent on domestic demand are attracting selective buying interest, while high-technology stocks, especially information-tech issues, remain in a correction.

Advances in management reforms are affecting the supply and demand situation on the market. Now that firms must include affiliates under “effective control,” regardless of equity stakes, in their consolidated earnings reports, wholesale management reforms have become unavoidable even for firms not keen to restructure.

The gains posted by low- and midpriced stocks are not likely to evaporate soon because they reflect changes in the nation’s book-closing rules.

Issues related to the so-called IT revolution and management reform are leading the upturn of the market, and the rebound is starting to affect non-IT sectors.

Concentration and expansion, accompanied by increased earnings, will take over the position as the main theme of stock trading from selection and concentration, giving priority to restructuring.

Among external factors affecting stock trading, U.S. stock trends and Japan’s political situation after the June 25 general election deserve close attention.

Expectations for another U.S. interest rate hike have eased, as recent data showed falls in employment and consumer spending in the U.S.

Corporate earnings therefore will draw stronger market attention than before.

In Japan, a focal point is whether government policies giving priority to an economic recovery will continue after the election.

When the Tokyo market stages a full recovery, buying interest will focus again on issues supported by favorable earnings prospects, such as makers of semiconductors, electronic parts and digital home appliances.

The market appears likely to come to a turning point in July, when Japan and the U.S. are expected to settle the question of cutting Nippon Telegraph and Telephone Corp.’s interconnection charges, currently the thorniest issue between the two countries.