JAPANESE stock prices dived nearly five per cent yesterday as Tokyo investors bailed out of the market following the rejection late on Friday of a political reform package.
The upper house of Japan's parliament rejected Prime Minister Morihiro Hosokawa's reform plan on a 130-118 vote on Friday after Tokyo markets closed.
The Nikkei benchmark average closed down 954.19 points, 4.94 per cent, at 18,353.24 yesterday. It was the largest one-day drop since 1990.
On September 26, 1990, the Nikkei average fell 1,121.18 points.
Jardine Fleming Securities (Japan) market analyst Chuck Lambert said the plunge had not been a total surprise.
''With the political reform bill failing to get through, it was expected that the market would go down by as much as 1,000 points,'' he said.