Bank of Japan will nearly double ETF sales from January to about JPY860 billion
a year (~$5.5bn), accelerating disposal of its large ETF holdings. Japanese
stocks reacted muted, with the Nikkei 225 hit in the morning by a global tech
sell-off before narrowing losses in the afternoon, suggesting markets can absorb
the additional supply. Market strategists say the step looks hawkish on paper
but is unlikely to materially disrupt prices given current average daily
turnover; for names whose free float was reduced by BOJ holdings, sales could
improve liquidity, indicating the bank assessed turnover and expectations limited
market distortion.
