Tokyo share prices soared virtually across the board on Wednesday, reacting positively to the Bank of Japan’s moves to funnel more money into the ailing economy.
The benchmark 225-issue Nikkei average, which lost 42.01 points Monday, rose 912.97 points, or 7.5 percent, to end the day at 13,103.94.
The seventh-largest single-day percentage gain ever lifted the key market gauge above the 13,000 level for the first time in three weeks.
In a spending spree by investors, volume on the main section jumped to 1.06 billion shares from 652.88 million Monday, with gainers overwhelming losers 1,370 to 66 and 33 issues closing unchanged.
It was the first time since Dec. 1 for volume to top 1 billion shares, except for so-called special quotation-fixing days, when trading is unusually active due to technical reasons.
Domestic and foreign institutional investors joined individual investors placing orders via the Internet and brokerage dealers, who have been the most active players in Tokyo over the past few months, brokers said.
There were indications that the BOJ had increased outright purchases of government bonds following its decision Monday to inject more liquidity into the banking system in an effort to keep the economy from sliding into a deflationary spiral.
Paying little heed to the tumble on Wall Street overnight, investors jumped on the buying bandwagon, said Hiroichi Nishi, general manager of Nikko Securities Co.’s products group.
They were elated by the outcome of the Japan-U.S. summit Monday in Washington, he said.
U.S. President George W. Bush expressed concern over Japan’s banks, which are overburdened by bad debts.
In response, Prime Minister Yoshiro Mori said his government will promote structural and regulatory reform to revitalize the economy and strengthen the financial system.
It is feared that Japan’s deepening financial crisis will also put pressure on the U.S. financial system.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.