Japanese stocks swung wildly before closing less than 1 percent higher, the day after the biggest rout since the March 2011 disaster erased $314 billion.
The Topix Index added 0.5 percent to close at 1,194.08 in Tokyo. The gauge earlier rose 3.3 percent and then fell by the same amount as the yen strengthened after Bank of Japan Governor Haruhiko Kuroda said enough stimulus had been announced. The Topix slid 6.9 percent yesterday.
“The market is going up and down like a roller coaster,” said Koji Toda, chief fund manager at Resona Bank Ltd. in Tokyo, which oversees the equivalent of $147 billion. “The fundamentals haven’t changed, but more and more investors are trading on momentum. Things will probably calm down in a week.”
The Nikkei 225 Stock Average pared a decline of as much as 3.5 percent to close 0.9 percent higher at 14,612.45. The Nikkei Volatility Index touched a two-year high, extending yesterday’s 58 percent jump, before retreating.
Tokyo Electric Power Co. surged 9.9 percent, recouping some of yesterday’s 13 percent loss, with utilities gaining the most among the Topix’s 33 industry groups. Airlines added 3 percent. Oil and coal producers slid 1.9 percent, while paper makers dropped 1.6 percent.
Even after this week’s 4.7 percent slump, the Topix is still up 39 percent for the year, making Japan the best-performing developed market. The Standard & Poor’s 500 Index has advanced 16 percent since the end of December, while the Stoxx Europe 600 Index added 9 percent.
Japan’s broadest equities gauge trades at about 1.3 times book value, compared with about 2.4 for the S&P 500 and 1.7 for the Stoxx 600.