Japan slump a sign of health?
Hong Kong (CNN) — Japan’s main trading index, the Tokyo Nikkei, plunged more than 7% Thursday, ending a red-hot rally that saw the bourse climb nearly 50% since the start of the year.
Investors reacted to negative news from the United States and China. U.S. Fed Chair Ben Bernanke left an open question on whether quantitative easing would end earlier than hoped, while new China data revealed factory activity fell the first time in seven months.
Though questions loom over the world’s first and second largest economies, analysts and economists agree that for Japan, the world’s third largest, things are just fine — despite this week’s stock slump.
The fact that investors pulled out is “a sign of health rather than a sign of worry,” said Jesper Koll, Director of Japan Equity Research at JPMorgan in Tokyo. “When markets go one way then it’s time to be concerned. The (Nikkei) has been up basically 70% over the last seven months.”
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In the history of global stock markets, such a major rally is very rare, added Koll. Since World War II, similar events have happened less than eight times. A correction was due.
“This looks like the selloff that so many on the sidelines have been waiting for,” said Nicholas Smith, CLSA’s Japan Strategist in Tokyo. “The Topix was undoubtedly overbought.”
Prime Minister Shinzo Abe’s fiscal policies for growth and inflation — known to many now as Abenomics — are not to blame so much as financial quakes and questions from the world’s other major economies. In support of Abenomics, the Bank of Japan this past Wednesday affirmed its own policies to buy long-term debt and securities. The move would double the central bank’s monetary base over two years.
“Such conduct of monetary policy will support the positive movements in economic activity and financial markets, contribute to a rise in inflation expectations, and lead Japan’s economy to overcome deflation that has lasted for nearly 15 years,” the bank said in its policy statement.
During those years of deflation and up through Abe’s election to the premiership in December 2012, Japan had a fiscal policy of “musaku” or “no policy” — “all talk but no action,” explained JPMorgan’s Koll.
Now “the most import thing is that Japan does have a policy. With Abe there is action. That’s what has been making investors confident.”
Signs of proof can be found in the return to profit of some of Japan’s exporters, in part due to the yen’s weakening against the U.S. dollar past the 100-yen mark. Toyota, the world’s biggest automaker, reported net income of $9.7 billion in the fiscal year that ended March 31 — more than triple its earnings from the year prior. Panasonic forecasts a net income of nearly $500 million in the 2014 fiscal year, versus a net loss of some $7 billion in 2013.
“We think they (corporate profits) are going to rise by about 50% over the next twelve months,” said Koll, who also forecasts Japan’s Topix — considered more representative of Japan’s stock markets — will climb to 1,400 by the end of 2013 — a rise of nearly 17%.
Article source: http://edition.cnn.com/2013/05/24/business/japans-stock-slump-sign-of-health/index.html?eref=edition
Firemen extinguish a blaze at a nursery school in the Stockholm suburb of Kista after riots in Sweden early Friday, May 24. Early media reports said the riots, which started Sunday, might have been triggered by police killing a 69-year-old man wielding a machete. But police say they are unsure of the cause.
Firemen extinguish a burning car parked in an indoor garage in the Stockholm suburb of Tureberg on May 24.
A man examines the debris around a row of burnt cars in the Stockholm suburb of Rinkeby on Thursday, May 23.
Firemen extinguish a burning car in Rinkeby outside of Stockholm on May 23.
People attend a demonstration against police violence and vandalism in the Stockholm suburb of Husby on Wednesday, May 22.
An injured man rests on a street bench after a stone hit his head during a demonstration in Husby on May 22.
Firemen extinguish a burning car in Kista on Tuesday, May 21.
Police officers secure an apartment building after overnight riots in Husby on Monday, May 20. The building had to be evacuated after a fire spread inside the parking garage.
Firemen extinguish a blaze at a nursery school in the Stockholm suburb of Kista after riots in Sweden early Friday, May 24. Early media reports said the riots, which started Sunday, might have been triggered by police killing a 69-year-old man wielding a machete. But police say they are unsure of the cause.
Firemen extinguish a burning car parked in an indoor garage in the Stockholm suburb of Tureberg on May 24.
A man examines the debris around a row of burnt cars in the Stockholm suburb of Rinkeby on Thursday, May 23.
Firemen extinguish a burning car in Rinkeby outside of Stockholm on May 23.
People attend a demonstration against police violence and vandalism in the Stockholm suburb of Husby on Wednesday, May 22.
An injured man rests on a street bench after a stone hit his head during a demonstration in Husby on May 22.
Firemen extinguish a burning car in Kista on Tuesday, May 21.
Police officers secure an apartment building after overnight riots in Husby on Monday, May 20. The building had to be evacuated after a fire spread inside the parking garage.
The Bare Conductive paint pen contains a non-toxic electrically conductive paint. The pens work the same way as glitter glue pens, and are designed to help people explore elecronics, and learn about circuit making.
Bare Conductive’s House Kit contains two paper houses, wired with conductive paint, which light up in the dark.
Rather than hiring an electrician to install switches, conductive paint could be used to send power across the surface of your wall. Indeed, a whole wall could feasibly be coated with conductive paint to make fumbling for a light switch a thing of the past.
Designer Patrick Stevenson-Keating developed a conductive paint-powered lamp for the 2012 Milan Furniture Fair. The lamp consists of a layer of liquid paint suspended in oil. When standing vertically two electrodes make contact with the conductive paint sending power to the bulb. By rotating the lamp horizontally, the contact is broken and the light goes off.
Bare Conductive’s Matt Johnson travelled to Budapest Design Week and ran a workshop with University students at the Bloodmountain Foundation.
The company has created a collection of prototype posters that respond to touch. When activated, the posters play audio, which they hope might be used in poster campaigns promoting festivals, music, TV shows and film.
Last year, conductive paint was used in a collection of interactive postcards created by Liverpool-based design agency 
DJ and producer Calvin Harris mounted a project with Bare Conductive, with painted dancers whose movements triggered loops from Harris’s hit song Ready for the Weekend.
Dundee University printed invitations to their 2011 product design MSc launch party with conductive paint. When plugged in to a system at the show, the invitation turned into a musical instrument. Users could control pitch by hovering one hand over a large circle of conductive paint, and frequency by pressing buttons with the other. 
The victim killed in a cleaver attack Wednesday was identified as Drummer Lee Rigby of 2nd Battalion The Royal Regiment of Fusiliers. The brutal killing of Rigby shocked the United Kingdom, with Prime Minister David Cameron saying the act appears to have been a terrorist attack.
A police officer stands with flowers in a hail storm on Thursday, May 23, close to the crime scene in front of Woolwich Barracks in southeast London.
A man contemplates at a scene where flowers lay, outside Woolwich Barracks in London.
Flowers lie outside Woolwich Barracks on May 23.
Soldiers walk outside Woolwich Barracks on Thursday, May 23, near where the soldier was killed.
Notes and shirts sit outside Woolwich Barracks on May 23. The slain soldier was wearing a “Help for Heroes” shirt when he was killed. 
British soldiers stand guard outside the barracks on May 23.
Members of the far-right English Defence League wear balaclavas as they gather outside a pub in Woolwich on Wednesday, May 22.
EDL supporters confront police in Woolwich on May 22.
EDL leader Tommy Robinson joins supporters at the crime scene on May 22.
A police officer guards a tent that’s been set up at the crime scene as investigations continue late May 22.
Mary Warder brings flowers to the scene of the crime on May 22 to pay respects to the victim.
Men place flowers near the scene on John Wilson Street.
A police officer guards a blocked-off area in Woolwich on May 22.
A general view of Woolwich Barracks, near the scene in Woolwich.
Police officers block off a road in Woolwich.
Forensic officers investigate the crime scene on May 22.
Police walk to the scene in Woolwich on May 22.
A still frame from video shows a man outside the Woolwich Barracks in London holding a cleaver and addressing the camera directly, moments after a serving soldier was hacked to death in the street on Wednesday, May 22. 
Britain’s prime Minister David Cameron addresses media representatives at 10 Downing Street in London on May 23, 2013, a day after a soldier who was hacked to death in a London street by two suspected Islamist extremists. 
