Tags: Japan | stock | market | correction

Japan's Falling Stock Market Triggers Fear of Collapse

Japan's Falling Stock Market Triggers Fear of Collapse

By    |   Thursday, 30 May 2013 11:34 AM

The 13 percent plunge in Japanese stocks since May 22 has sparked concern that an all-out meltdown may ensue.

"What worries me a little bit is when some of those foreign buyers who have dominated the rally in recent weeks wake up in the U.S. or Europe and take a look at their Japan portfolio," one equity salesman told the Financial Times.

"I don't know how many of them have been actively buying Japan for real reasons, or in part because of the hype. They could be having trouble explaining what's happened."

Editor's Note:
 
Prophetic Economist Warns: “It’s Curtains for America.” See Evidence.

The benchmark Nikkei 225 stock average is still up 32 percent for the year to date. That gain stems from the massive fiscal and monetary stimulus pushed by Prime Minister Shinzo Abe.

"Japan's great stock rally officially entered correction territory on Thursday," the Times stated.

But what apparently began as a mere correction for stocks has snowballed into something far worse.

"Selling is feeding into more selling," Soichiro Monji, chief strategist at Daiwa SB Investments, told Bloomberg. "It's not that the market is tanking because of a special event."

The Nikkei had been driven up by "lots of global macro funds putting on multibillion-dollar strategies," Doug Butcher, head of equity sales at BNP Paribas in Tokyo, told the Times. "When they're looking at taking profits, a little goes a long way."

And concern has arisen that Japan's loose fiscal and monetary policy will produce a spike in interest rates and inflation.

However, some don't see it that way. Ryoji Musha, an ex-Deutsche Bank analyst, told the Times that Japan's correction is "necessary and healthy" and "nothing to worry about."

Editor's Note: Prophetic Economist Warns: “It’s Curtains for America.” See Evidence.

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The 13 percent plunge in Japanese stocks since May 22 has sparked concern that an all-out meltdown may ensue.
Japan,stock,market,correction
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2013-34-30
Thursday, 30 May 2013 11:34 AM
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