The Lowest Point Below 9,000 Yen After a Lapse of 19 Years

On October 3, Nikkei Stock Averages of TOKYO, Japan repeated the continuous decrease of 4 days and collapsed a level of 9,000 Yen after the lapse of 19 years. At that day, Nikkei Stock Price ended to 8,936.43 decreased by 112.9(1.25%) over the previous day. It was the lowest point since August 12, 1983 (8,920.82 Yen).

Tokyo stock market has showed a declining tendency day after day owing to a pessimistic prospect on economic recovery because the Japanese government decided to promote the economic restructuring such as the NPL sales but didn’t take any measure for deflation.

Especially, there is an unfavorable factor that the large companies could be bankrupted if it enforces the NPL sales in a situation of a vague economic recovery.

In the stock market, there was the sale order focused on the large bank and insolvent companies’ stocks owing to the news that the special project team was organized and started to arrange the definite measure for the disposal of NPL.

The Japanese government has promoted to inject the public fund prevention to financial institutions and delayed an abolishment of the full deposit amount guarantee system scheduled next April. It has been anxious to prevent the financial uneasiness owing to the NPL sales, but the stock market doesn’t show the particular response.

The experts forecasted “The sales of NPL will increase the deflation pressure for the short term and have a influence the stock price. However, it will be the stable element of the stock market for the middle and long term.”

Young-Ee Lee yes202@donga.com