Share prices rose in heavy trading Thursday on the Tokyo Stock Exchange amid reports the government was putting the finishing touches on a plan to restore health to the nation's beset banking industry.
The 225-issue Nikkei average, a 532.62-point gainer the previous day, rose 108.69 points to finish the day at 16,471.58. The closely followed market gauge rose for the seventh trading day in a row, recouping much of its losses over the past three months.
Many long-neglected financial issues suddenly became the market's favorites as market players awaited the details of a "bridge bank" scheme to be announced later in the day.
The market pinned high hopes on the government's indicated move to clean up banks' bad-loan mess and pull the economy out of the recession. The government and Liberal Democratic Party were expected to give a formal go-ahead to the rescue package for banks at the end of their talks in the evening, a scheme patterned after a plan used by the U.S. Federal Deposit Insurance Corp. to address the savings and loan crisis of the late 1980s.
The government of Prime Minister Ryutaro Hashimoto was signaling to the marketplace that it intends to introduce a bill for the plan at an extraordinary Diet session to be convened after the July 12 Upper House elections.