Tokyo shares close sharply higher; market bottom seen on BoJ, bad loan moves

TOKYO (AFX-ASIA) - Share prices closed very sharply higher on hopes the market has found its bottom after the Bank of Japan implemented quantitative easing measures Monday and on signs that the resolution of bad debts in the banking system will now be accelerated, dealers said.	    The central bank approved a de-facto inflation targetting policy and an effective return of the overnight call rate to zero while saying it is ready to buy more government bonds if necessary, they said.	    Wall Street's overnight declines on disappointment at the Fed's 50 point rate cut were largely put to one side, as was the latest central bank monthly survey even though the Bank of Japan found that the economic recovery has now "paused," they noted. 	    The Nikkei 225 index closed up 912.97 points at its intraday high of 13,103.94, off a low of 12,100.97.	    Volume was a heavy 1.06 trln shares.	    The Topix was up 75.80 points at 1,275.41, while the Nikkei 300 finished 15.95 points higher at 260.13.	    The Nikkei June futures contract was up 410 points at 12,410 on the Osaka exchange and at 12,430 on the SGX.	    There were 1,370 gainers and 66 decliners, with 33 stocks unchanged.            Merrill Lynch senior strategist Masatoshi Kikuchi said the market has likely bottomed out, finally, after the monetary easing measures introduced by the Bank of Japan and signs of an acceleration of the resolution of banks' bad debts.	    "I think the market has bottomed ... The demand and supply balance has improved as (the sale) of cross-shareholdings decreases" and liquidity from the BoJ washes into the equity market.	    Kikuchi added that the market expects further disposals of bad debts by the banks following encouraging noises from the government, as well as the move by the UFJ bank group to double its planned write-offs.	    "The disposal of bad loans will accelerate," he said, although noting that this will be negative for heavily indebted companies.	    Finance Minister Kiichi Miyazawa said the government will be able to arrange the grand design for a bad loan resolution plan in six months but added it will be "difficult to resolve all problems in that term."	    Among the banks, Mizuho Holdings rose 63,000 to 690,000, with Sumitomo Bank up 95 at 1,080 and its merger partner Sakura ahead 67 at 637, while Asahi climbed 11 to 320.	    UFJ group banks were higher with Sanwa up 30 at 750, Tokai Bank up 10 at 450 and Toyo Trust up 14 at 338. 	    Meanwhile, Kikuchi said "export-oriented companies will benefit" from the decline in the yen on the BoJ's monetary easing and benign neglect on the part of the government.	    In particular, automakers and precision instrument makers, such as Canon and Ricoh, are likely to see gains as they are seeing increased market share that will offset the decline in the overall market as the U.S. decelerates.	    "The impact from the yen will be bigger than the U.S. slowdown" for these companies, particularly as, unlike chipmakers, they do not have large levels of inventory to unwind.	    Among exporters, Toyota rose 290 to 4,650, with Nissan rallying 35 to 855 and Mitsubishi Motors up 21 at 371. Canon was up 170 at 4,600, while Ricoh was up 280 at 2,385.	    Rohm gained 780 to 18,680, with TDK rising 640 to 7,250 and Kyocera up 750 at 10,750. 

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