March 2 Reuters The listed shares of the Japanese and Swiss central banks rose sharply on Tuesday, without any apparent underlying reason, in what traders said was a reflection of high levels of investor exuberance in markets flooded with cash.

Shares in the Bank of Japan BOJ and the Swiss National Bank SNB gained as much as 21 and 4.6 respectively, but traders struggled to pinpoint any fundamental drivers behind the surge.

Due to their peculiar ownership structure, both central banks, which set monetary policy in economies with the worlds best known funding currencies, have a low free float which can exacerbate moves in their share prices.

One could see the rise in BOJ shares as symbolic of how markets are driven by excess liquidity, said Takashi Nakamura, a senior strategist at Japans Tokai Tokyo Research Institute.

Were starting to see signs of a bubble everywhere in the stock market, he added.

BOJ shares climbed above 40,000 yen 374, their highest since October 2018, having risen 46 over the last three sessions. The government owns more than half of the stock.

Veteran investors were reminded of the late 1980s when Japan was experiencing an assetprice bubble and BOJ shares became the target of speculative trading, rising 40fold in four years.

SNB shares built on Mondays strong gains, recorded after it posted a net 2020 profit of 20.9 billion Swiss francs.

Traders in Zurich said retail investors were most likely driving the move but volumes remained thin….