• Sat
  • Aug 23, 2014
  • Updated: 5:28pm

Nikkei slips before member reshuffle

PUBLISHED : Sunday, 23 April, 2000, 12:00am
UPDATED : Sunday, 23 April, 2000, 12:00am

It was Tokyo's turn to hog the headlines last week, when the benchmark Nikkei-225 Index hit a 15-week closing low on Friday.


Tomorrow's reshuffle of the index's components overshadowed Tokyo on Good Friday.


The Nikkei closed at 19,009 on Monday last week, but declined to 18,252.68 on Friday, down 3.72 per cent on the day and the lowest since January 7, when it ended at 18,193.41.


In contrast, the broader Topix Index rose, closing at 1,634.12, up 5.12 points, or 0.31 per cent.


Several issues to be removed from the key index in the reshuffle, including Fuji Spinning, Nippon Metal Industry and Tokyo Rope Manufacturing, hit record lows.


The pendulum swung both ways, with some of those to be added - Kao, Eisai, Terumo, TDK, Taiyo Yuden and Tokyo Electron - making record gains.


Fears of a false dawn on Wall Street were compounded when the Nasdaq Composite Index dropped 62.53 points on Thursday, to close at 3,643.88 points, unable to sustain the previous day's optimistic 3,706.41 points. The index had clawed its way back up from Monday's 3,400 points.


Investors continued to take refuge in blue chips, sending the Dow Jones Industrial Average up 169.09 points on the day on Thursday to 10,844.05.


Market players everywhere continue to focus on upcoming US economic indicators, such as an employment cost index for the first quarter, to be announced on Thursday. Fears of an interest rate increase may grow if indicators point to inflation in the US.


Closer to home, the Hang Seng Index fell on Thursday, led by China Telecom (Hong Kong) and Internet-related companies, mirroring the decline in similar US shares on the Nasdaq.


The Hang Seng Index fell 60.06, or 0.4 per cent, on Thursday to 15,367.14, from Monday's 14,762.37. The Growth Enterprise Market Index fell 2.15 points, or 0.35 per cent, on Thursday to 604.81, down from Monday's close of 698.1.


Thursday's turnover on the main board of HK$7.59 billion was the lowest since November 3 and half the average for the past three months.


Commenting on the market moves, South China Brokerage vice-president Howard Gorges predicted a slow period. He expected low trading volumes in coming weeks because of the public holidays and people sitting tight until firm news on US inflation emerged.


'The markets are going nowhere, just treading water,' he said.


He put the Hang Seng Index's ceiling this week at 15,800, with resistance above that level, against a downside on bad US news of 15,000.


Tung Tai Securities' Kenny Tang Sing-hing saw market weakness persisting with low levels of liquidity as consolidation continued.


The US was still unstable, waiting for direction from the interest-rate setting Federal Reserve, he said.


He predicted the Hang Seng Index would swing between 15,000 and 16,000 points next week.


Last week's range of about 600 points between Monday's close of 14,762 and Thursday's of 15,367.14 was indicative of what was to come in the present holding pattern.


Elsewhere, London's FTSE-100 Index wriggled up slightly to close at 6,241.2 points on Thursday after beginning the week at less than 6,000, with Monday's close of 5,994.6.


Anna Healy Fenton

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