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| Version 1 | Version 2 |
|---|---|
| Japanese stocks fall on profit taking | Japanese stocks fall on profit taking |
| (about 9 hours later) | |
| Japan's main stock index, the Nikkei 225, fell by 2.35% on Monday - the first trading day of the new year, as investors booked profits. | |
| Japanese shares have surged over the past year, with the Nikkei 225 index rising by 57% in 2013. | |
| The surge has been prompted by a series of aggressive policies unveiled by the government to revive Japan's economy. | The surge has been prompted by a series of aggressive policies unveiled by the government to revive Japan's economy. |
| The steps have seen a sharp decline in the yen's value, helping lift exports and boost profits of leading exporters. | The steps have seen a sharp decline in the yen's value, helping lift exports and boost profits of leading exporters. |
| The yen hit a five-year low against the US dollar on Friday - but recovered slightly in early Asian trade on Monday. | The yen hit a five-year low against the US dollar on Friday - but recovered slightly in early Asian trade on Monday. |
| Analysts said the recovery in the yen had also prompted the sell-off in Japanese shares. | Analysts said the recovery in the yen had also prompted the sell-off in Japanese shares. |
| "Tokyo stocks are overbought, and a break in the yen's fall, plus weaker futures are sure to result in some long-needed profit-taking after the December run-up," said Hiroichi Nishi, general manager of equities at SMBC Nikko Securities. | "Tokyo stocks are overbought, and a break in the yen's fall, plus weaker futures are sure to result in some long-needed profit-taking after the December run-up," said Hiroichi Nishi, general manager of equities at SMBC Nikko Securities. |
| The Nikkei fell by as much as 2.6% at one point, but recovered slightly to end the day down 382.43 points at 15,908.88. | |
| Other Asian markets also fell after another survey added to evidence that China's economy slowed towards the end of last year. | |
| The HSBC/Markit Economics Purchasing Managers' Index for China's service sector fell to 50.9 in December, down from 52.5 the month before and the lowest reading since August 2011. A figure above 50 indicates expansion. | |
| China's benchmark Shanghai Composite Index fell 1.8% to 2,045.71, and Hong Kong's Hang Seng dropped 0.6% to 22,684.15. | |
| Further jump? | Further jump? |
| Japan's economy, the world's third-largest, has been stagnant for nearly two decades. | Japan's economy, the world's third-largest, has been stagnant for nearly two decades. |
| In an attempt to revive growth, Japan's policymakers have unveiled a series of moves including doubling the country's money supply. | In an attempt to revive growth, Japan's policymakers have unveiled a series of moves including doubling the country's money supply. |
| The moves have seen the yen weaken more than 20% against the US dollar since January last year. | The moves have seen the yen weaken more than 20% against the US dollar since January last year. |
| A weaker yen makes Japanese goods more affordable for foreign buyers and boosts profits of exporters when they repatriate their foreign earnings back home. | A weaker yen makes Japanese goods more affordable for foreign buyers and boosts profits of exporters when they repatriate their foreign earnings back home. |
| A weak currency, coupled with signs of a recovery in the Japanese economy, has helped boost investor sentiment and lifted Japanese stocks. | A weak currency, coupled with signs of a recovery in the Japanese economy, has helped boost investor sentiment and lifted Japanese stocks. |
| Analysts said that Japan's central bank, the Bank of Japan, was likely to continue to take further steps to help sustain the recovery - which would help boost stocks further in the coming months. | Analysts said that Japan's central bank, the Bank of Japan, was likely to continue to take further steps to help sustain the recovery - which would help boost stocks further in the coming months. |
| "We know there is more to come from the Bank of Japan," Richard Jerram, chief economist at Bank of Singapore, told the BBC. | "We know there is more to come from the Bank of Japan," Richard Jerram, chief economist at Bank of Singapore, told the BBC. |
| "The yen is going to keep going down and as we saw last year, it's a fairly simple dynamic. It boosts the corporate sector, boosts profits and the stock market." | "The yen is going to keep going down and as we saw last year, it's a fairly simple dynamic. It boosts the corporate sector, boosts profits and the stock market." |
| Mr Jerram said that Japan's main stock index could rise between 15% to 20% in the current year. | Mr Jerram said that Japan's main stock index could rise between 15% to 20% in the current year. |