Brokerages Brace for Japan's Longest Market Shutdown Since WWII
(Bloomberg) -- Japanese brokerages are taking steps to help relieve at least some investors worried about getting trapped by the country’s unusually long holiday next month related to the emperor’s succession.
Markets in Japan are scheduled to be closed from April 27 through May 6 because the government has designated national holidays around the abdication of Emperor Akihito, in addition to annual Golden Week days off over that period. In total, markets will be shut for six trading sessions, sparking concerns of volatility.
Brokerages have started implementing measures that may alleviate trouble for investors in overseas stocks at least. Daiwa Securities Group Inc. plans to make make trading in U.S. and Europe-listed stocks available for its Japanese clients on April 30 and May 2, said Yuji Kamioka, a spokesman for the Tokyo-based firm. SMBC Nikko Securities Inc. is considering setting up a call center to handle transactions from clients looking to sell U.S.-listed equities, NHK reported. Rakuten Securities Inc. earlier this week cautioned investors of possible post-holiday volatility.
These actions may alleviate some problems for investors who otherwise may not have had a way out of positions for more than a week. Extended holiday closures bring back memories of January’s “flash crash,” when Japan’s four-day New Year holiday exacerbated liquidity constraints in the currency market, sending the yen soaring against the dollar.
The impact for domestic stocks from the break planned for April-May remains to be seen. The total 10-day market closure will be Japan’s longest since the end of World War II, a spokesman at Japan Exchange Group Inc. said.
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