The Japanese stock market index has surged past the 40,000-point mark, with seven top investors known as the “Seven Samurai” ushering in a new era of bull market in Japan!

By admin Mar 18, 2024

apanese stocks have surged past the 40,000-point mark, with the “Seven Samurai” leading the way and creating a new era of bull market in the Japanese stock market in 2024. The concept of the “Seven Samurai” proposed by Goldman Sachs Securities is likened to the “Magnificent 7” of the US stock market. Unlike the US “Magnificent 7” which is predominantly focused on the tech industry, the Japanese “Seven Samurai” represents various sectors of the Japanese industry and cutting-edge technology, highlighting the outstanding performance of Japanese companies across major industries. Following the breakthrough of the 40,000-point mark in the Japanese stock market, the “Seven Samurai” of the Japanese stock market indicates the potential for further upward momentum, supported by improvements in Japan’s deflation, proactive policy reforms, and an expected record increase in spring wage hikes.

The “Seven Samurai” include Mitsubishi Corporation, Toyota and Subaru, two automobile manufacturers favored by Warren Buffett, as well as four semiconductor companies: Screen Holdings, Advantest, Disco Corp, and Tokyo Electron. These companies have shown strong performance and stability, contributing to the overall rise of the Japanese stock market. The name “Seven Samurai” is inspired by Akira Kurosawa’s film of the same name and serves as a counterpart to the “Magnificent 7” driving the US stock market.

The Japanese stock market’s resilience and steady growth have been attributed to the efforts of the “Seven Samurai” and the balanced performance across various industries, indicating a healthy market structure. The robust earnings and profitability of Japanese companies, along with ongoing structural reforms, have fueled the rise of the Japanese stock market. Furthermore, factors such as the depreciation of the yen, loose monetary policies by the Bank of Japan, and the strong performance of the semiconductor industry have contributed to the continued growth of the Japanese stock market.

In terms of investment strategy, it is suggested to view the upcoming “normalization of the Bank of Japan’s monetary policy” positively, as it signifies Japan’s departure from a long-standing deflationary environment and sets a more stable economic environment for future growth. The Japanese stock market is expected to continue its upward trajectory, and potential short-term fluctuations or pullbacks may present buying opportunities for long-term investors. Local expertise and analysis are recommended when investing in Japanese stocks to identify companies with growth potential and capitalize on the positive market conditions.

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