Tokyo shares closed mixed on future, high-techs, stimulus proposals

TOKYO (AFX-ASIA) - Share prices closed mixed on technical trade after the special quotation for March futures and options contracts, sales of technology stocks and expectations of stimulus proposals by the ruling political parties, dealers said. They added that the stimulus measures are unlikely to continue to support the market, given the complications related to their implementation and the likely lack of focus on underlying structural reform. The Nikkei 225 index closed down 22.66 points at 12,627.90, off a low of 12,500.51 and a high of 12,667.21. Volume was an estimated 1.355 bln shares, with SQ-related activity causing a sharp increase in trade this morning. The Topix was 1.56 points at 1,237.76, while the Nikkei 300 was up 0.21 at 252.09. The Nikkei June futures contract was up 10 points at 12,630 on the Osaka exchange and at 12,645 on the SGX. There were 828 decliners and 488 gainers,with 147 stocks unchanged. Technology issues were lower after declines on NASDAQ related to the profit warning and management changes at Yahoo! while Intel's after-hours profit warning added to the negative tone. Rohm fell 410 to 19,090, with Advantest declining 350 to 12,200, Kyocera down 180 at 9,920 and Tokyo Electron down 430 at 7,450. Fujitsu lost 55 to 1,535, with Hitachi falling 8 to 996 and NEC down 38 at 1,728. Among the internet stocks, Yahoo Japan fell 50,000 to 5.7 mln yen, with its parent Softbank losing 150 to 4,920. Dealers said the market was supported elsewhere as details of the ruling parties planned stimulus package leaked out. Takayoshi Taniguchi, a senior member of New Komeito, which is one of the three ruling coalition parties, told AFX News that the stimulus plans would include proposals to create a government-linked body to buy the banks' shares. "The ruling parties will work out an emergency economic stimulus package today, which will include the setting up of a body to purchase banks' cross-shareholdings," Taniguchi said. However, analysts were sceptical about such moves. Merrill Lynch chief economist Jesper Koll said the focus of the market is on corporate restructuring, not government intervention and until that happens in a coherent and significant fashion, investor sentiment is unlikely to improve. kpap. UBS Warburg strategist Dick Beason said the market wants to see real structural reform and while there could be something of a bounce on the announcement of the programme, it is unlikely to prove that significant. Mitsubishi Electric rose 19 to 684 on a Nihon Keizai Shimbun report that the company will double its year to March 2001 dividend to 10 yen due to a brisk earnings recovery. Blue-chip exporters remained in focus thanks to the yen's softer tone in the foreign exchange market, dealers said. Toyota rose 60 to 4,130, with Nissan gaining 19 to 808 and Mazda up 23 at 330.

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