By Anne D. Picker, International Economist,Econoday
Monday, February 25, 2002

Markets were mixed last week as investors continued to view profit statements with skepticism. And with little new economic data available, investors swung from buying on dips to selling in fright. Only four of 13 indexes followed here managed to rise on the week. In Asia, the Japanese Nikkei and Topix and the South Korean Kospi were up on the week. In Europe and the Americas, only the U.S. Dow managed a positive end to a choppy trading week.

The meeting in Tokyo between U.S. President George Bush and Japanese Prime Minister Junichiro Koizumi disappointed the many market players who were looking for some sort of policy initiative. Investors now are focusing on the much ballyhooed deflation plan that will be announced by Koizumi on Wednesday. Meanwhile, the verbal intervention continued, this time on behalf of stock prices, which had sunk to long time lows earlier in the month. Investors responded enabling the Nikkei to regain then hold above the 10,000 level. But the delays in economic reform as well as the sacking of his popular foreign minister have weakened Koizumi's grip on power. His public approval rating is now in the low 50s compared to the high 80s when he won office on hopes he would change politics as usual in Japan. More and more voters see him as another do-nothing leader, trapped by old guard LDP politicians who advocate more government spending and protectionism to shelter the economy.

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