Japanese Market

It's about time.Long-suffering investors in stock funds that emphasize Japanese equities, nearly losing hope over several dismal years, are pleased with the dramatic 1993 rally on the Tokyo Stock Exchange.They're also nervous that the always quirky Japanese market is getting ahead of itself.A recently unveiled fiscal stimulus package from the Japanese government, coupled with an interest-rate cut, should help that troubled economy. But the steps are unlikely to work miracles.New investors seeking to diversify by putting money into the revival of this Asian industrial giant should enter with their eyes open.

American businesses should complain less and do more to promote their exports, according to a Japanese steel executive speaking in Baltimore yesterday."

With the Japan vs. America battle of words and products going full blast, it's worth noting that Japan's stock market and economy have been on a losing streak.Following a meager 8 percent gain last year, the Japanese stock market is down by a similar percentage in 1992. That traditionally overvalued market is an amazing 45 percent below its peak level in 1989, when the slide began.Meanwhile, the country has lurched into recession as the Bank of Japan has boosted interest rates. It's unlikely to snap out of it until the end of this year, or perhaps 1993.

IF OUR RESPONSE to criticism of this country's work ethic is simply to get mad, we will undoubtedly misdirect our energy and rage at the Japanese competitive challenge, rather than meet it. Our challenge is not to look at ourselves through the imperfect prism of Japanese criticism, but to find ways to work smarter.Without getting hung up on what the Japanese prime minister said, isn't it true that we are producing too few engineers and basic research scientists and too many lawyers and accountants and MBAs?

NEW YORK -- Driven by the prospect of higher-than-expected corporate earnings, low inflation, and an upturn in the U.S. economy, the stock market appears to have stabilized from its modest correction last month -- and perhaps stands in a position to post new gains.Whether it actually roars to new highs, however, is in part contingent on the Japanese stock market and the extent of recovery here."We're definitely in a bull market," said Gene Jay Seagle, a vice president with Gruntal & Co., an investment house.

WASHINGTON -- Fuji Photo Film, citing "glaring flaws" in an annual U.S. review of foreign trade barriers, yesterday renewed its call for a neutral fact-finding mechanism to resolve allegations that Japan's market for photographic film isn't open to foreign competition.A National Trade Estimate report released this week "provides a one-sided picture of market conditions in Japan," Fuji Film lawyer Bill Barringer said in a letter delivered to U.S. Trade Representative Mickey Kantor.The NTE report is based entirely on the "uncritical acceptance of Kodak's allegations rather than any objective investigation of hotly disputed facts," Mr. Barringer said in his letter to Mr. Kantor.

Acquisition of QVC completedComcast Corp. and Tele-Communications Inc. said yesterday that they have completed their $1.42 billion acquisition of QVC Inc., accepting all shares of the home shopping network that were tendered.The transaction closed one week after the Federal Trade Commission voted 4-0 to let TCI buy a bigger share in QVC, ending months of uncertainty for the nation's largest cable TV operator.Comcast owns 57.4 percent of the joint venture, while TCI's Liberty Media owns about 42.6 percent.

It's time for mutual fund investors to decide whether the cup is half empty or half full.The good news, for example, is that Merrill Lynch Technology Fund Class "A" gained 14.89 percent in the first quarter to rank among the nation's best-performing stock funds.The bad news is that the fund had been up a whopping 23 percent just 10 days before quarter's end, before the market deluge took its toll.It's that kind of volatile year. The average stock fund slipped 3 percent, with funds specializing in emerging markets, small company growth and utilities hit hardest.

Give your trusty money market fund and bank certificate of deposit great big hugs.Even their modest yields beat the 5.84 percent decline posted by the average stock mutual fund in the first half of this year.The importance of diversifying holdings among different types of funds, rather than simply jumping from one bandwagon to another, is evident in the latest stock fund results.Last year's darlings, the emerging market and Latin American funds, have stumbled badly. So have gold-oriented and environmental funds.

Japan, which may not be the perfect economic juggernaut after all, lately has grown accustomed to losing face.There was the bribery scandal that led to the resignation of its prime minister two years ago.This year's embarrassment, coming in the midst of a three-month decline in the Tokyo stock market, was the resignation of key securities industry executives due to improper reimbursement of big clients for losses in last year's market collapse.Surprisingly, such revelations may not be bad for either Japan or for would-be investors in stocks of Japanese companies.