Is it a "great buying opportunity" or the beginning of a bear market? After a huge crash, the Nikkei Average had its largest increase ever!

On the 6th, the Japanese stock market, following the historic decline on the 5th, rebounded significantly, with the Nikkei average up 10.23% and TOPIX up 9.30%.The Nikkei average, turning around from the previous day's record decline of 4,451.28 yen, recorded the largest increase of 3,217.04 yen.In addition to the rebound from the decline on the 5th, the reversal of the exchange rate to a weaker yen, and the market's relief as the US July ISM non-manufacturing PMI exceeded market expectations at 51.4, easing concerns of an economic slowdown.

Some investors see it as a "bargain sale".
Regarding the volatile movement of the Japanese stock market, domestic fund managers believe that "overseas long-term investors see it as a bargain sale and are moving to buy".There is a possibility that "overseas long-term investors see it as a bargain sale and are moving to buy" (Nikkei newspaper dated 6th).Furthermore, Bloomberg dated 6th states that "as the exchange rate stabilizes, buying back of Japanese stocks is occurring according to Risona Asset Management's Chief Strategist Shimode Shuuichi".If there is no change in performance, it is clear that Japanese stocks are undervalued.It introduces comments that some investors consider it a great buying opportunity.

Will there be unstable movements for a while?
On the other hand, Chief Strategist Shimode has also mentioned that it is likely to be a market driven by speculation due to a period with few economic indicators.Chief Market Strategist Masahiro Ichikawa of Sumitomo Mitsui DS Asset Management also expressed the view in the Sankei newspaper dated the 6th that the market is expected to show unstable movements for a while.For a while, the market is expected to show unstable movements.For a while, the market is expected to show unstable movements.Chief Market Strategist Masahiro Ichikawa of Sumitomo Mitsui DS Asset Management also expressed the view in the Sankei newspaper dated the 6th that the market is expected to show unstable movements for a while.
Citi Index's senior market strategist Matt Simpson described the movement of Japanese stocks as a "healthy adjustment after an unhealthy crash," and indicated the possibility of continued cautious investor sentiment.Not a rise in risk-on sentiment.(Bloomberg on the 6th) and analysis, suggesting the potential for continued cautious investor sentiment.

37 years ago, Black Monday hit the bottom two weeks later
By the way, on Black Monday in October 1987, when the daily decline rate of the Nikkei average was 14.9% and more severe than the big crash on the 5th, it took about 2 weeks for the stock prices to reach the bottom from the big crash on October 20th. The stock prices returned to the same level as the high on October 14th, just before Black Monday, in April of the following year, taking about 6 months.