JGB market mood turns positive - Reuters survey
TOKYO, Dec 25 (Reuters) - A weekly gauge of sentiment in the Japanese government bond market has turned positive for the first time in eight weeks, with many survey respondents expecting a bottoming-out in bond prices after a decline in the past two weeks.
JGBs have fallen in the past fortnight, partly on worries Japan's incoming Prime Minister Shinzo Abe will increase debt to fund large-scale stimulus steps.
The poll's JGB bull-bear diffusion index, calculated by subtracting the number of bearish market players from those who are bullish, came in at plus 4, its first positive reading since late October, when it was also plus 4.
"We expect JGB yields to fall as the market will likely be supported by the uncertainty over the U.S. fiscal cliff and by position adjustments ahead of the year-end," said a fund manager at an asset management firm.
The improvement in the diffusion index, however, mainly stemmed from a drop in the number of respondents expecting yields to rise, rather than an increase in those who expect yields to fall.
The median forecast for the 10-year JGB yield at the end of this week is 0.757 percent, almost the same as Friday's closing level of 0.760 percent. The yield hit a seven-week high of 0.780 percent last week.
The online survey of 97 JGB market participants from major institutions received 29 responses, for a response rate of 29.9 percent. These included 17 "real money" investors from institutions such as banks, pension and investment funds and insurance companies.
The survey was conducted from Friday to 8:00 a.m. on Tuesday (2300 GMT on Monday). Japanese markets were shut on Monday for a public holiday.
(Reporting by Yoshiyasu Shida; Writing by Hideyuki Sano; Editing by Michael Perry)