The , abbreviated as Tosho () or TSE/TYO, is a

stock exchange A stock exchange, securities exchange, or bourse is an exchange where stockbrokers and traders can buy and sell securities, such as shares of stock, bonds and other financial instruments. Stock exchanges may also provide facilities for th ...

located in

Tokyo Tokyo (; ja, 東京, , ), officially the Tokyo Metropolis ( ja, 東京都, label=none, ), is the capital and largest city of Japan. Formerly known as Edo, its metropolitan area () is the most populous in the world, with an estimated 37.468 ...

Japan Japan ( ja, 日本, or , and formally , ''Nihonkoku'') is an island country in East Asia. It is situated in the northwest Pacific Ocean, and is bordered on the west by the Sea of Japan, while extending from the Sea of Okhotsk in the north ...

. It is the third largest stock exchange in the world by aggregate

market capitalization Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders. Market capitalization is equal to the market price per common share multiplied by t ...

of its listed companies, and the largest in

Asia Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...

. It had 2,292 listed companies with a combined market capitalization of US$5.67 trillion as of February 2019. The exchange is owned by the Japan Exchange Group (JPX), a holding company that it also lists (). JPX was formed from its merger with the Osaka Exchange; the merger process began in July 2012, when said merger was approved by the

Japan Fair Trade Commission The is the competition regulator in Japan. It is a commission of the Japanese government responsible for regulating economic competition, as well as enforcement of the Antimonopoly Act. Headed by a chairman, the commission is commonly known a ...

. JPX itself was launched on January 1, 2013.

Overview

The TSE is incorporated as a ''

kabushiki gaisha A or ''kabushiki kaisha'', commonly abbreviated K.K. or KK, is a type of defined under the Companies Act of Japan. The term is often translated as "stock company", " joint-stock company" or "stock corporation". The term ''kabushiki gaisha'' i ...

'' (

joint-stock company A joint-stock company is a business entity in which shares of the company's capital stock, stock can be bought and sold by shareholders. Each shareholder owns company stock in proportion, evidenced by their share (finance), shares (certificates ...

) with nine directors, four auditors and eight executive officers. Its headquarters are located at 2-1 Nihonbashi- Kabutochō, Chūō,

which is the largest

financial district A financial district is usually a central area in a city where financial services firms such as banks, insurance companies and other related finance corporations have their head offices. In major cities, financial districts are often home to s ...

. The main indices tracking the

stock market A stock market, equity market, or share market is the aggregation of buyers and sellers of stocks (also called shares), which represent ownership claims on businesses; these may include ''securities'' listed on a public stock exchange, as ...

of TSE are the

Nikkei 225 The Nikkei 225, or , more commonly called the ''Nikkei'' or the ''Nikkei index'' (), is a stock market index for the Tokyo Stock Exchange (TSE). It has been calculated daily by the '' Nihon Keizai Shimbun'' (''The Nikkei'') newspaper since 1950 ...

index of companies selected by the '' Nihon Keizai Shimbun'' (Japan's largest business newspaper), the

TOPIX , commonly known as TOPIX, along with the Nikkei 225, is an important stock market index for the Tokyo Stock Exchange (TSE) in Japan, tracking all domestic companies of the exchange's Prime market division. It is calculated and published by the ...

index based on the share prices of Prime companies, and the J30 index of large industrial companies maintained by Japan's major broadsheet newspapers. There are also active

bond market The bond market (also debt market or credit market) is a financial market where participants can issue new debt, known as the primary market, or buy and sell debt securities, known as the secondary market. This is usually in the form of bonds, bu ...

and

futures market A futures exchange or futures market is a central financial exchange where people can trade standardized futures contracts defined by the exchange. Futures contracts are derivatives contracts to buy or sell specific quantities of a commodity or ...

. Ninety-four domestic and 10 foreign securities companies participate in TSE trading. ''See:

Members of the Tokyo Stock Exchange General Trading Participants of the Tokyo Stock Exchange
* Nihon Keizai Shimbun,

Kyodo News is a nonprofit cooperative news agency based in Minato, Tokyo. It was established in November 1945 and it distributes news to almost all newspapers, and radio and television networks in Japan. The newspapers using its news have about 50 millio ...

Jiji Press is a news agency in Japan. History Jiji was formed in November 1945 following the breakup of Domei Tsushin, the government-controlled news service responsible for disseminating information prior to and during World War II. Jiji inherited Dom ...

, or business television broadcasters such as

Bloomberg LP Bloomberg L.P. is a privately held financial, software, data, and media company headquartered in Midtown Manhattan, New York City. It was co-founded by Michael Bloomberg in 1981, with Thomas Secunda, Duncan MacMillan, Charles Zegar, and a 1 ...

and

CNBC CNBC (formerly Consumer News and Business Channel) is an American basic cable business news channel. It provides business news programming on weekdays from 5:00 a.m. to 7:00 p.m., Eastern Time, while broadcasting talk sho ...

. The Kabuto Club is generally busiest during April and May, when public companies release their annual accounts.

Hours

The exchange's normal trading sessions are from 9:00 a.m. to 11:30 a.m. and from 12:30 p.m. to 3:00 p.m. on all days of the week except Saturdays, Sundays and holidays declared by the Exchange in advance. The exchange is closed for the following holidays:

New Year's Day New Year's Day is a festival observed in most of the world on 1 January, the first day of the year in the modern Gregorian calendar. 1 January is also New Year's Day on the Julian calendar, but this is not the same day as the Gregorian one. Wh ...

Coming of Age Day is a public holiday in Japan held annually on the second Monday of January. It is held in order to congratulate and encourage all those who have reached or will reach the age of maturity (20 years old) between April 2 of the previous year an ...

National Foundation Day is an annual public holiday in Japan on 11 February, celebrating the foundation of Japan, enforced by a specific Cabinet Order set in 1966. 11 February is the accession date of the legendary first Emperor of Japan, Emperor Jimmu, converted int ...

Vernal Equinox Day is a public holiday in Japan that occurs on the date of the Northward equinox in Japan Standard Time (the vernal equinox can occur on different dates in different time-zones), usually March 20 or 21. The date of the holiday is not officially ...

Shōwa Day is a public holiday in Japan held on April 29. It honors the birthday of Emperor Shōwa (Hirohito), the reigning emperor from 1926 to 1989. Shō (昭) means “shining” or “bright”, and wa (和) means “peace”, signifying the "enlight ...

Constitution Memorial Day is a public holiday in Japan. It takes place on May 3 in celebration of the enactment of the 1947 Constitution of Japan. It is a part of the collection of holidays known as Golden Week (Japan), Golden Week. History After the Atomic bombings of H ...

Greenery Day The present observation of as a public holiday in Japan stems from the celebration of the birthday of the Emperor Shōwa ( Hirohito, who lived from 1901 to 1989) on April 29 every year during the Shōwa era (1926 - 1989). In 1989, following the ...

Children's Day Children's Day is a commemorative date celebrated annually in honor of children, whose date of observance varies by country. In 1925, International Children's Day was first proclaimed in Geneva during the World Conference on Child Welfare. Sin ...

, Marine Day,

Respect for the Aged Day is a public holiday in Japan celebrated annually to honor elderly citizens. It started in 1966 as a national holiday and was held on every September 15. Since 2003, Respect for the Aged Day is held on the third Monday of September due to the Ha ...

, Autumnal Equinox,

Health and Sports Day , formerly , is a public holiday in Japan held annually on the second Monday in October. It commemorates the opening of the 1964 Summer Olympics held in Tokyo, and exists to promote sports and an active lifestyle. History and current practice T ...

Culture Day is a public holiday in Japan held annually on November 3 for the purpose of promoting culture, the arts, and academic endeavor. Festivities typically include art exhibitions, parades, and award ceremonies for distinguished artists and scholars. ...

Labour Thanksgiving Day is an annual public holiday in Japan celebrated on November 23 of each year, unless that day falls on a Sunday, in which case the holiday is moved to Monday. The law establishing the holiday cites it as an occasion to respect Manual labor, la ...

, and The Emperor's Birthday.

Stock market

First, Second and other Sections until April 4, 2022

Markets of Tokyo Stock Exchange 2014-12-11

Until April 4, 2022, corporate shares are listed and traded at Tokyo Stock Exchange in five market sections: the First Section which started when Tokyo Stock Exchange was re-established in 1949 and includes mainly large companies; the Second Section which started in 1961 and includes mainly mid-sized companies;

JASDAQ , formerly the is one of the sections of the Tokyo Stock Exchange. It was formerly an independent stock exchange. JASDAQ is not related to NASDAQ in the United States, but has operated an electronic trading system similar to NASDAQ. History In 1 ...

(established in 1991, acquired by

Osaka Stock Exchange , renamed from , is the largest derivatives exchange in Japan, in terms of amount of business handled. , the Osaka Securities Exchange had 477 listed companies with a combined market capitalization of $212 billion. The Nikkei 225 Futures, intro ...

in 2010, and absorbed into TSE in 2013) and

Mothers ] A mother is the female parent of a child. A woman may be considered a mother by virtue of having given birth, by raising a child who may or may not be her biological offspring, or by supplying her ovum for fertilisation in the case of gesta ...

(Market of the high-growth and emerging stocks, established at TSE in 1999) which are both for emerging companies; and Tokyo Pro Market, TOKYO PRO Market which was established in 2009 jointly with

London Stock Exchange London Stock Exchange (LSE) is a stock exchange in the City of London, England, United Kingdom. , the total market value of all companies trading on LSE was £3.9 trillion. Its current premises are situated in Paternoster Square close to St Pau ...

as an

Alternative Investment Market AIM (formerly the Alternative Investment Market) is a sub-market of the London Stock Exchange that was launched on 19 June 1995 as a replacement to the previous Unlisted Securities Market (USM) that had been in operation since 1980. It allows ...

(Tokyo AIM) for small companies. There were a total of 3,821 companies listed in Tokyo Stock Exchange, as of March 31, 2022.Number of Listed Companies/Shares (Japan Exchange Group)
/ref>

Prime, Standard and Growth Markets since April 4, 2022

Tokyo Stock Exchange reorganization in 2022 2022-01-27

Beginning April 4, 2022, the market divisions were restructured into the Prime, Standard and Growth market divisions, differentiated by

market liquidity In business, economics or investment, market liquidity is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price. Liquidity involves the trade-off between the ...

corporate governance Corporate governance is defined, described or delineated in diverse ways, depending on the writer's purpose. Writers focused on a disciplinary interest or context (such as accounting, finance, law, or management) often adopt narrow definitions th ...

, and other criteria. Companies voluntarily selected their new division between September and December 2021, and the results were published on January 11, 2022. From the First Section, 1841 companies were transitioned into the Prime market and 344 companies were transitioned into the Standard market. All 474 companies in the Second Section were also transitioned into the Standard market. From

, all 658 companies in its Standard subsection were transitioned into the Standard market and all 36 companies in the Growth subsection were transitioned into the Growth market, along with all 424 companies in the

section. There were a total of 3,825 companies listed in Tokyo Stock Exchange, as of August 31, 2022.

History

Prewar

The Tokyo Stock Exchange was established on May 15, 1878, as the under the direction of then- Minister of Finance (Japan), Finance Minister

Ōkuma Shigenobu Marquess was a Japanese statesman and a prominent member of the Meiji oligarchy. He served as Prime Minister of the Empire of Japan in 1898 and from 1914 to 1916. Ōkuma was also an early advocate of Western science and culture in Japan, and ...

and capitalist advocate

Shibusawa Eiichi was a Japanese industrialist widely known today as the "father of Japanese capitalism". He spearheaded the introduction of Western capitalism to Japan after the Meiji Restoration. He introduced many economic reforms including use of double- ...

. Trading began on June 1, 1878. In 1943, the exchange was combined with eleven other stock exchanges in major Japanese cities to form a single . The combined exchange was shut down on August 1, days before the bombing of

Hiroshima is the capital of Hiroshima Prefecture in Japan. , the city had an estimated population of 1,199,391. The gross domestic product (GDP) in Greater Hiroshima, Hiroshima Urban Employment Area, was US$61.3 billion as of 2010. Kazumi Matsui h ...

Postwar

150px, Logo used prior to JPX merger The Tokyo Stock Exchange reopened under its current Japanese name on May 16, 1949, pursuant to the new Securities Exchange Act. The TSE runup from 1983 to 1990 was unprecedented, in 1990 it accounted for over 60% of the world's stock market capitalization (by far the world's largest) before falling precipitously in value and rank one of the 4th largest exchange in the world by market capitalization of listed shares. The current TSE building was opened on May 23, 1988, replacing the original TSE building from 1931, and the trading floor of the TSE was closed on April 30, 1999, so that the exchange could switch to electronic trading for all transactions. A new facility, called , opened on May 9, 2000. In 2010, the TSE launched its Arrowhead trading facility. In 2001, the TSE restructured itself as a

("stock company"): before this time, it was structured as an with its members as shareholders. On 15 June 2007, the TSE paid $303 million to acquire a 4.99% stake in Singapore Exchange Ltd. The

(LSE) and the TSE are developing jointly traded products and share technology, marking the latest cross-border deal among bourses as international competition heats up. In July 2008, the LSE and the TSE announced a new joint venture Tokyo-based market, which will be based on the LSE's

(AIM). File:Tokyo Stock Exchange Building circa 1960.jpg, Old Tokyo Stock Exchange building ( 1960) File:TokyoStockExchange1950.jpg, Tokyo Stock Exchange (1950) File:The_Tokyo_Stock_Exchange_-_main_room_2.jpg, The annular electric bulletin board on the market center (2018) File:The_Tokyo_Stock_Exchange_-_main_room_3.jpg, Main room of the Tokyo Stock Exchange (2018)

Technology problems

The exchange was only able to operate for 90 minutes on November 1, 2005, due to bugs with a newly installed transactions system, developed by

Fujitsu is a Japanese multinational information and communications technology equipment and services corporation, established in 1935 and headquartered in Tokyo. Fujitsu is the world's sixth-largest IT services provider by annual revenue, and the la ...

, which was supposed to help cope with higher trading volumes. The interruption in trading was the worst in the history of the exchange until October 1, 2020.Fujitsu execs take pay cut after Tokyo exchange crash
25th November 2005 Trading was suspended for four-and-a-half hours. During the

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...

of advertising giant

Dentsu Dentsu Inc. ( ja, 株式会社電通 ''Kabushiki-gaisha Dentsū'' or 電通 ''Dentsū'' for short) is a Japanese international advertising and public relations joint stock company headquartered in Tokyo. Dentsu is currently the largest advertis ...

, in December 2001, a trader at

UBS Warburg UBS Group AG is a multinational Investment banking, investment bank and financial services company founded and based in Switzerland. Co-headquartered in the cities of Zürich and Basel, it maintains a presence in all major financial centres ...

, the Swiss investment bank, sent an order to sell 610,000 shares in this company at ¥1 each, while he intended to sell 1 share at ¥610,000. The bank lost £71 million. During yet another initial public offering, that of J-Com, on December 8, 2005, an employee at

Mizuho Securities Co., Ltd. is a Japanese investment banking and securities firm. It is a wholly owned subsidiary of Mizuho Financial Group. History The current Mizuho Securities is established by a merger between Shinko Securities and the former Mizuho Securities. The f ...

mistakenly typed an order to sell 600,000 shares at ¥1 each, instead of an order to sell 1 share at ¥600,000. Mizuho failed to catch the error; the Tokyo Stock Exchange initially blocked attempts to cancel the order, resulting in a net loss of US$347 million to be shared between the exchange and Mizuho. Both companies are now trying to deal with their troubles: lack of error checking, lack of safeguards, lack of reliability, lack of transparency, lack of testing, loss of confidence, and loss of profits. On 11 December, the TSE acknowledged that its system was at fault in the Mizuho trade. On 21 December, Takuo Tsurushima, chief executive of the TSE, and two other senior executives resigned over the Mizuho affair. On January 17, 2006, the Nikkei 225 fell 2.8%, its fastest drop in nine months, as investors sold stocks across the board in the wake of a raid by prosecutors on internet company

livedoor was a Japanese company that functioned as an Internet service provider and operator of a web portal and blog platform before being brought down by a scandal in 2006. The company was founded and led in its first 10 years by Takafumi Horie, known ...

. The Tokyo Stock Exchange closed early on January 18 due to the trade volume threatening to exceed the exchange's computer system's capacity of 4.5 million trades per day. This was called the "livedoor shock". The exchange quickly increased its order capacity to five million trades a day. On October 1, 2020, for the first time in its history, the Tokyo Stock Exchange had to suspend trading in all shares for a whole day due to a technical glitch, causing buying and selling to freeze. This was announced just minutes before 9 a.m., when it was scheduled to open. The problem was found to be in "the system for relaying market information", hence making the glitch a network problem, but the ''

Asahi Shimbun is one of the four largest newspapers in Japan. Founded in 1879, it is also one of the oldest newspapers in Japan and Asia, and is considered a newspaper of record for Japan. Its circulation, which was 4.57 million for its morning edition and ...

'' reported that the glitch was due to a mechanical failure. Japan Exchange Group Inc., which operates the Tokyo Stock Exchange, said that the suspension would be indefinite until the problem was resolved. Other stock markets in Japan also suspended trading. Normal trading was resumed the following day.

References

External links

Tokyo Stock Exchange Website
''

The New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid ...

'', 13 December 2005
"Fujitsu execs take pay cut after Tokyo exchange crash"

The Register ''The Register'' is a British technology news website co-founded in 1994 by Mike Magee, John Lettice and Ross Alderson. The online newspaper's masthead sublogo is "''Biting the hand that feeds IT''." Their primary focus is information tec ...

, 25 November 2005
Tokyo Stock Exchange Building
{{Authority control Economy of Tokyo Japan Exchange Group * Stock exchanges in Japan Financial services companies established in 1878 Japanese companies established in 1878 Postwar Japan Nihonbashi, Tokyo Financial services companies based in Tokyo *