Japanese Stock Market

Japan Stock Market: What Impacts Its Functions?

Japan is a developed country. It has a strong economy based on its industries. Being a free market economy, Japan has developed a lot. It has shown major growth in almost all sectors, and has now become an economical super power. The Japan stock market is one of the biggest stock markets of the world, and shows the economic strength of the country..

The Japan stock market is commonly known as Nikkie. It is situated in Tokyo, the capital of Japan. This is why it is also called the Tokyo Stock Exchange. It is the second largest stock market of the world after the New York Stock Exchange, and lists 31 foreign companies as well as 2271 domestic companies. The total market capitalization of the Tokyo Stock Exchange is over 5 trillion USD Mark.

The Tokyo Stock Exchange has basically nine directors, four auditors, and executive officers. This is the general body of the people who run the Tokyo stock exchange. The headquarters of the Japan Stock Market is located in Chuo-ku in Tokyo. This is the main stock market of Japan, and is the center of all the economic activities of the country.

There are two very prominent features in the Japanese stock market. The first feature is its extremely volatile stock prices. This fluctuation in prices is mainly because of the free market economy of Japan. The impact of this fluctuation in the stock prices is clearly visible on its stock market.

Another important characteristic of Japanese Stock Exchange is its dominance by cross-shareholding, and the stagnation in individual stock ownership. The reason for this is again its free market economy that allows anyone to trade within Japan, and control as much stocks as they want without any major problem. But, this sometimes creates many problems for the proper functioning of the stock market.

The functioning of stock market depends largely on the functioning of the economy. In the other words, the nature of economy of any country determines the functionality of its stock market. The economy of a country has a direct impact on the functioning of the stock market. These two are closely interrelated and inter linked. They have to be studied together, as they depend on each other.

Japan, being an industrial nation, its economy heavily banks on its industries and exports. Japan also lacks in raw materials. This also is a major factor behind its imports. All these factors combine together to influence the functioning of its stock exchange.

The Japan Stock Market, being one of the biggest stock exchanges of the world, is always under public scanner. Its functions are greatly affected by its economy.