‘Clouds Have Disappeared’; Japan’s Markets Expected to Regain Steam

Japan’s financial markets, overshadowed for months by uncertainty about Emperor Hirohito’s health, are expected to rise this week after his death Saturday, dealers and traders said.

“The psychological clouds hanging over the markets for months have now disappeared,” said a stock analyst at a major securities house.

The markets have been restrained in recent months on fears of sudden declines after the emperor’s death, he said.

Japan’s stock, bond and commodity markets were closed for their half-day sessions Saturday, but will open for business as usual today along with the foreign exchange market.

Most stock traders said institutional investors may temporarily refrain from active trades out of respect for the late emperor.

Some brokers suggested last week that the Tokyo market’s 225-share Nikkei index, which hit a record high of 30,397.51 last Thursday, could fall about 300 points after Hirohito’s death.

But after a brief decline in stock prices, the market should rally and rise to new highs, they said.

“I am more than 100% sure that the market indicator will soon renew its highs to celebrate the new era,” a trader at another brokerage said.

The death of the emperor should boost profits for paper-related companies, because of the printing of fresh calenders bearing the name of the new imperial era, which could help their shares.

Foreign exchange dealers said the emperor’s death will have little impact on currency trading in Tokyo today.

“Market operators are not likely to be active on Monday out of respect for the late emperor, but trading will not be especially limited,” one dealer said.