Reported by Star-Bulletin staff & wire
Thursday, March 15, 2001
Tokyo stocks tumble, then jump 309 points
TOKYO -- Tokyo stocks plunged early and then rebounded to close higher today following speculation that the government bought stocks to prop up the sagging market. The U.S. dollar climbed against the yen.The benchmark 225-issue Nikkei Stock Average rose 309.24 points, or 2.61 percent, to close at 12,152.83 points. Yesterday, the average closed up 23.89 points, or 0.20 percent. The dollar bought 120.62 yen, up 0.74 yen from yesterday in Tokyo but below its New York level of 121.11 yen overnight.
The Nikkei rebounded after falling 392.48 points, or 3.31 percent, in morning trading after worries of a global economic slowdown sent U.S. stocks into a nosedive overnight.
Concern about Japan's economic outlook and the massive bad loans at Japanese banks prompted selling in a broad range of issues, traders said.
The index rebounded on buying by foreign investors amid rumors that the government bought shares to bolster the market, which sank to a 16-year low on Tuesday.
The government often intervenes in the stock market to boost share prices ahead of the fiscal year-end book closing on March 31. The practice, known as "price-keeping operations," is meant to shore up the earnings of debt-saddled banks.
International ratings agency Fitch placed 19 major Japanese banks on "negative review" yesterday over growing worries about the impact of sliding share prices on operations.
U.S. trade deficit surges to record $435.4 billion
WASHINGTON -- America's deficit in the broadest measure of trade rose to an all-time high of $435.4 billion last year as an increase in U.S. exports failed to offset a huge rise in imports of consumer goods and oil.The Commerce Department reported today that the deficit in the current account was up a sharp 31.3 percent from the previous record of $341.5 billion set in 1999. The gain for the year came as no surprise, given that the quarterly deficits rose steadily to record highs. The fourth-quarter deficit rose to $115.3 billion, a 1.9 percent increase from the $113.1 billion third-quarter imbalance.
European meat scare hurts McDonald's
NEW YORK -- McDonald's Corp. said yesterday that its first-quarter earnings would fall more than expected because of slumping sales in Europe, where consumers scared of mad cow disease are buying fewer hamburgers.
"The effect of consumer concerns regarding the European beef supply has persisted longer than we expected," said Jack M. Greenberg, the company's chairman and chief executive. For the quarter, McDonald's now expects to earn 29 cents to 30 cents a share, down from the 33 cents a share the firm earned in the quarter a year earlier. Analysts had expected a profit of 32 cents a share.
Coke to launch new orange juice
ATLANTA -- The Coca-Cola Co. is introducing a new not-from concentrate orange juice that will compete with PepsiCo Inc.'s popular Tropicana Pure Premium brand juice.Simply Orange Juice Co., a new subsidiary of Coke's Houston-based Minute Maid unit, will begin marketing the juice in the Northeast in May, Coca-Cola said today. The juice, to be called Simply Orange, will come in pulp-free, calcium-fortified and high-pulp varieties.