Over the last third of the month, investors took profits and adjusted their positions to the market's higher level, leading the Nikkei to a March 31 close of 15,836.59. The news was not all good, however, since the market's 15,836.59 final figure for FY 1998 was 4.2 percent lower than the 16,527.17 at which it had ended FY 1997. Japanese companies that choose to use current market prices to value their securities holdings likely will have losses for FY 1998. Market watchers and other analysts are particularly eager to find out what impact the Nikkei 225's March 31 close had on the capital bases of Japanese banks. With the Dow Jones Industrial Average around the 10,000 level, American investors have been looking overseas for bargains.
Japan is near the top of the list.
Hitachi, Ltd., for example, announced April 1 that it would eliminate another 6,500 jobs by the end of FY 1999 on top of the 4,000 it cut in FY 1998. The work force reduction will be achieved by not replacing retiring workers, offering early retirement bonuses to older employees and transferring 4,000 people to a new home electronics affiliate. Debate over whether these plans represent a sharp break with the past or are simply more window dressing is intense, but economic analysts all agree that they are a step in the right direction.