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Japan stocks rise in late rally | Japan stocks rise in late rally |
(30 minutes later) | |
Japan's Nikkei index staged a late rally on Tuesday to close up 6.4%, having earlier fallen below the 7,000 mark for the first time in 26 years. | |
Authorities said that to stabilise markets they would bring forward a ban on traders selling shares that they do not already own and have not borrowed. | |
The Nikkei 225 index closed up 459.02 points at 7,621.92. | |
Exporters were helped by a sharp fall in the value of the Japanese yen against the US dollar. | |
The yen has been appreciating against the dollar recently, but on Tuesday its value fell to 95.51 yen to the dollar from 93.01. | |
Asian gains | |
Share prices across Asia had initially lost ground again on opening, following volatile trading throughout the world. | |
South Korea's Kospi index initially dropped 2.6%, but later rose to finish 5% up on the day. | |
In Hong Kong, shares ended the morning up 6.1%, clawing back some of the losses from Monday's 12.7% decline. | |
Early ban | |
Japan's Finance Minister Shoichi Nakagawa told reporters that the ban on naked short-selling, which had been due to come into force on 4 November, would be brought forward. | |
Naked short selling involves making a deal to sell shares that you do not own and relying on being able to buy the shares before the deal has to be settled. | Naked short selling involves making a deal to sell shares that you do not own and relying on being able to buy the shares before the deal has to be settled. |
It is done by traders who hope that the price of the shares will fall between the sale and the purchase of the shares, allowing them to pocket the difference. | It is done by traders who hope that the price of the shares will fall between the sale and the purchase of the shares, allowing them to pocket the difference. |
The announcement follows similar moves by governments in the US, Australia and Europe. | The announcement follows similar moves by governments in the US, Australia and Europe. |
"I decided on the measure because these few days will be critical and stock exchanges are facing risks unless we take quick action," said Mr Nakagawa. | "I decided on the measure because these few days will be critical and stock exchanges are facing risks unless we take quick action," said Mr Nakagawa. |
"Japan was easily under pressure from other sources and that is why is was important to change the rules to US and European standards." | "Japan was easily under pressure from other sources and that is why is was important to change the rules to US and European standards." |
Meanwhile Japan's Prime Minister Taro Aso has said he will delay calling a general election in order to handle the economic crisis, according to the Kyodo news agency. | |
Mr Aso, who took office a month ago, had been widely expected to call an early election to address the deep divisions in the Japanese parliament. | |
European shares | |
Stock markets in the US and Europe ended lower on Monday amid a growing belief that key economies are heading into recession. | |
On Wall Street, the main Dow Jones index fell 2.42%, despite being boosted earlier in the day by a surprise rise in new home sales in September. | On Wall Street, the main Dow Jones index fell 2.42%, despite being boosted earlier in the day by a surprise rise in new home sales in September. |
The FTSE 100 in London closed down 0.79%, the Cac 40 in Paris ended down 3.96% but the Dax in Frankfurt was up 0.91%. | The FTSE 100 in London closed down 0.79%, the Cac 40 in Paris ended down 3.96% but the Dax in Frankfurt was up 0.91%. |
Earlier the FTSE had fallen 5.6% to 3,665 points - its lowest level since April 2003. | Earlier the FTSE had fallen 5.6% to 3,665 points - its lowest level since April 2003. |