Cabinet ministers and ruling party lawmakers stepped up their calls Tuesday for fresh measures to boost plummeting stock prices, a day after the Nikkei average hit a 26-year low and was close to falling through the 7,000 level.
Hiroyuki Hosoda, secretary general of the Liberal Democratic Party, pointed to the need at a news conference to "float overall stock prices by injecting funds."
He aired concerns about the negative impact that declining bank shares are having on the ability of companies, particularly small and midsize enterprises, to raise capital, and gave assurances the government and ruling camp will "firmly deal with" the stock plunges.
Akira Amari, state minister in charge of administrative reform, said current stock prices "do not reflect (economic) fundamentals at all" and that shares have been sold "in a chain reaction."
Amari also called for steps to lift sagging stock prices but declined to elaborate on possible measures for fear of influencing market movements.
Finance Minister Kaoru Yosano, meanwhile, said the government will "resolutely fight against the credit crunch triggered by falling stock prices," indicating he will put priority on encouraging financial institutions to keep providing funds.
Chief Cabinet Secretary Takeo Kawamura admitted the government lacks a trump card to deal with the stock falls and pledged to take "all possible measures," including early implementation of fiscal 2009 budget bills and the purchase of bank-held shares by a government-backed entity.
Tokyo stocks have fallen on a gloomy outlook for the global financial sector and the poor state of the Japanese economy, with the Nikkei closing Monday at 7,086.03, its lowest finish since Oct. 6, 1982. The index continued to slip Tuesday morning, trading below the Monday close and coming close to sinking below the psychologically important 7,000 line.