Rakuten jig highlights Japan's warped benchmark
07/09/2016 04:06
(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)
By Quentin Webb
HONG KONG, Sept 7 (Reuters Breakingviews) - Shares of the
shopping website leapt on news it would join the Nikkei 225. It
shows the power of an arbitrary index weighted by share price
instead of fundamentals like size or free float. The Bank of
Japan's $60 bln-a-year push into index funds will only amplify
the distortion.
Full view will be published shortly.
CONTEXT NEWS
- Shares in Rakuten leapt on Sept. 7, after the Japanese
e-commerce company was earmarked for inclusion in Japan's
benchmark Nikkei-225 stock index as of Oct. 3.
- By 11:05 a.m. in Tokyo (0205 GMT), Rakuten shares stood
6.3 percent higher at 1,417 yen a share, lifting the stock to
its highest levels since December 2015.
- The move contrasted with a 0.7 percent dip in the Nikkei
index, and a 12 percent slide in Nippon Soda, a maker of
chemicals and drug ingredients, which will leave the index.
- Last month shares in FamilyMart leapt more than 10 percent
on news the retailer would be added to the index.
- For previous columns by the author, Reuters customers can
click on WEBB/
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Reuters: Bank of Japan's rush into stocks raises fears of market
distortions urn:newsml:reuters.com:*:nL3N1AW1R6
Nikkei statement http://indexes.nikkei.co.jp/en/nkave/archives/news/20160906E_1.pdf
BREAKINGVIEWS - BOJ does bare minimum for Abenomics reboot
urn:newsml:reuters.com:*:nL4N1AF16P
BREAKINGVIEWS - Bank of Japan's boldness risks diminishing
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(On Twitter https://twitter.com/qtwebb Editing by Una Galani
and Katrina Hamlin)
((quentin.webb@thomsonreuters.com;)(Reuters
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Keywords: RAKUTEN STOCKS/BREAKINGVIEWS