After holding out for some time against market adjustments in the United States and Europe, Tokyo stock prices fell broadly Tuesday amid fears of contagion from this week's tumble in New York share prices.
Bullish investors had counted on an economic recovery, improving corporate earnings and a pickup in the flow of money from public funds, but doubts remain about this scenario.
Recent economic indexes indicate that the Japanese economy has bottomed out and is on a recovery path. This recovery may be short-lived, however, as it is being led by an increase in exports after temporary inventory buildups in the U.S. Exports from Japan will begin to slow sooner or later as there are emerging signs that the rapid U.S. economic recovery in the January-March period was a temporary phenomenon.