The Tokyo Stock Exchange kicked off 2002 on an upbeat note Friday, with share prices forging ahead along a broad front during the half-day session.
The benchmark 225-issue Nikkei average rose 328.87 points, or 3.1 percent, to end the first session of the year at 10,871.49.
The Topix index of all shares listed on the first section ended the session higher at 1,053.96, up 21.82 points, or 2.1 percent.
The market took its tone from a surge in New York share prices overnight.
The TSE rang in the new year with a traditional hand-clapping ceremony in which brokerage and exchange officials, along with selected guests, took part.
Masaaki Tsuchida, president and chief executive officer of the TSE, said the bourse will try to expand its product range and provide useful information in an effort to attract more investors.
The TSE will promote attractive products, including exchange-traded funds, which are index-based mutual funds that can be traded throughout the day, and will increase transparency and convenience within the market, Tsuchida said.
"We will expand our information services, particularly in the area of listed companies' corporate information," he said.
As the flow of capital and information across borders increases and investors' needs multiply, the TSE will continue to push ahead with market reforms to compete with domestic and overseas markets, Tsuchida said.
TSE, formerly a membership organization, made a fresh start in November as a stock company.
Despite a festive opening ceremony, many analysts cautioned that the uptick in share prices could soon run out of steam.
Indeed, with the disastrous 2001 fresh in everyone's memory, skepticism abounds over the prospects of the months ahead, with usually bullish brokerage officials voicing caution in anticipation of further volatility.
Many analysts believe seasonal selloffs will drive the Nikkei down to close to 9,000 before listed companies close their ledgers in March for the 2001 business year.
They fear the government and the Bank of Japan will fail to launch a concerted effort soon enough to prevent the economy from sliding into a deflationary spiral.
The reform initiatives of Prime Minister Junichiro Koizumi have forced the nation's financial institutions to step up their efforts to write off bad loans and reign in new lending -- major factors behind the recent series of corporate bankruptcies.
Even big-name companies have been forced out of business, sending the nation's unemployment rate to 5.5 percent in November.
The TSE's dismal performance, coupled with the yen's rapid fall against the dollar, has prompted a flight of money out of domestic financial markets and into foreign securities, a scenario typically bearish for Tokyo stocks.
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