Tokyo stock prices have firmed back to levels before the Sept. 11 terrorist attacks in the United States.
Sales to liquidate cross-shareholding ties have run their course, with firms closing their books for the first half of fiscal 2001 at the end of September.
The market has rallied also since excessive pessimism after the terrorism has eased.
Although there are lingering concerns about possible recurrences of terrorism, the initial shocks following the attacks on New York and the Pentagon and uncertainty about U.S.-led military action against terrorist targets in Afghanistan have dissipated.
The recovery, however, of economic activity in major countries and of leading companies' earnings will be unavoidably delayed.
With macro- and microeconomic concerns continuing, rises in Tokyo stock prices will be limited in the coming months despite the return of stability to the market.
The key 225-issue Nikkei average therefore is expected to face strong resistance on its upside at 11,000 for now, although it is unlikely to fall anywhere near the Sept. 12 intraday low of 9,504.41, set immediately after the terrorist attacks in the U.S.
It is fair to say the terrorist attacks have dragged the U.S. economy into a slump. In the midterm, however, the continuing threat looks likely to accelerate an economic recovery in the U.S. by promoting stock adjustments.