Tokyo stocks are in vogue again after being hammered for months.

With the uptrend in share prices gaining speed, the key Nikkei average has reclaimed the 11,000 level after slumping to 9,420.85 on Feb. 6.

The average of 225 leading shares closed at 11,919.30 on March 11, having risen nearly 2,500 points, or 27 percent, in a little more than a month.

There is a feeling among investors that the market has found its bottom.

The daily turnover this month averaged 975.8 billion yen as of Monday and now seems set to recover the 1 trillion yen level for the first time since April 2000.

The main catalyst for the strong rally was a faster-than-expected U.S. economic recovery.

The U.S. Institute of Supply Management reported earlier this month that its index of manufacturing activity had risen to its highest level since April 2000.

The index jumped to 54.7 in February from 49.9 in January.

In response, the Dow Jones industrial average leaped 217 points on March 4, following a 262-point gain on March 1, the previous trading day.

The rally in New York has prompted foreign investors to rebuild their Japanese portfolios, while tightened regulations on short selling have triggered a flurry of activity to cover short positions on the Tokyo market.

Daiwa Institute of Research Ltd. expects listed companies to chalk up, on average, a 56 percent year-on-year increase in consolidated pretax profits in fiscal 2002, marking a striking turnaround from a 43 percent drop in the current year.

The consumer electronic machinery sector is heading for its best year in some time, pacing the recovery in industry earnings.

Consolidated pretax profits for all industries are projected at 14 trillion yen for the coming fiscal year, compared with 9 trillion yen in fiscal 2001 and 16 trillion yen in fiscal 2000.

The electronics sector alone is expected to register 1 trillion yen in pretax profits in fiscal 2002, compared with deficits of 2 trillion yen in fiscal 2001 and 3 trillion yen in gross profits in fiscal 2000.

Investors are opting for export-oriented high-tech shares and cyclical issues sensitive to domestic demand fluctuations.

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