FLJP - The Rally In Japanese Stocks
2024-02-06 00:55:00 ET
Summary
- Japan's economic growth is projected to decelerate to 0.9% in 2024 and 0.8% in 2025.
- Government policies have helped the recovery of Japanese stocks and will continue to be a positive factor going forward.
- Business investment and consumer services look likely to be sources of strength, as do semiconductors and related electronics.
By William H. Witherell, Ph.D.
Having attracted only limited investor interest for over two decades after reaching a record in December 1989, Japanese stocks surged ahead last year in a rally that came very close - within 6% - to the earlier record in mid-January. The Nikkei 225 gained 7.7% in January and is up 31.7% over the last 12 months through January 31st. In comparison, the S&P 500 Index gained 18.35% over the same period. The MSCI ACWI ex-USA Index (global stocks ex-US) gained just 4.6% over the past 12 months, with a swoon in Chinese stocks being a major negative cause. The Shanghai Composite Index declined by 16.9%, and Hong Kong's Hang Seng dropped by 29.5%. There are multiple factors underlying this recent striking outperformance of Japan's stock market. They have implications for market prospects in the coming months....
The Rally In Japanese Stocks