[Nikkei Average] Looking back from the historic crash to rapid recovery (2024/08/05 to 2024/08/16)
On 2024/8/5, which is fresh in my memory, the Nikkei Stock Average recorded a major crash with a closing price of 31,458 yen and an astonishing decline of -4,452 yen.
Just two weeks before that, 2024/07/11, happened just when the highest price in Nikkei history of 42,224 yen was added.
I am also an information sender, and when I was watching the comment section of the video explaining the Great Crash, the “usual forces” left comments that further fueled anxiety due to examples such as “the stock market is over” and “the Nikkei Average will break 0.02 million yen.”
After that, the Nikkei Stock Average recovered rapidly
If you think about it, today (2024/08/16), when I'm writing this article, the closing price is 38,062 yen,Recovery of 6,000 yen or more in just 8 business daysI did.
As the unstable market continues, I would like to look back once again on market prices and market speculations from 2024/07/11, when the all-time high was set, to today.
The Nikkei average had a sense of overheating along with the dollar and yen
First, let's check each index of the Nikkei Average around 2024/07/11, which set the highest value in history.
The image below shows the daily Nikkei Stock Average and each index that uses a weighted average.
The part circled in green is the PER of the Nikkei Average, and the part circled in red is the 2024/07/11 index with the highest value in history.
I think people who have been in a reasonable relationship with the market price for a long time know, but sensitivelyThe PER of the Nikkei Stock Average is cheap when it is around 12, and there is a sense of overheating when it reaches around 15That seemed like common sense up until then, but especiallyFrom 2024, it is natural for the market to move at 16 to 17 let alone PER15It had become.
The image belowPER changes in the Nikkei AverageThat's it. You can see that PER trends have risen rapidly since around spring 2023.
Nonetheless, if it is an individual stock, the entire index called Japan's Nikkei Average, which is not yet an emerging country, will suddenly be reviewed.
It is fresh in my memory that the Nikkei Average PER became a catalyst that began to enter an upward trend in the spring of 2023.”PBR 1 times split improvement request by the Tokyo Stock ExchangeIt's”.
Along with that, the depreciation of the yen progressed due to interest rate differences between Japan and the US.
Personal funds also flowed into the market price in the wake of the start of the new NISA system, etc., to further spur it.
In other words, in summary, what formed the large market price from the spring of 2023 to the summer of 2024
・PBR 1 fold correction reform by the Tokyo Stock Exchange
・The depreciation of the yen progresses (increased profit)
・The country's investment promotion stance (new NISA, etc.)
It can be said that this is because these three materials were concentrated in a short period of time.
Among theseWhat is a particularly large materialThe depreciation of the yen progressesIt goes without saying that.
Interest rate difference between Japan and the US
How to search for the cause of the progression of the depreciation of the yen, which had a major impact on the exchange rateGoing back to the Japan-US environment during the COVID-19 pandemicIt is necessary to sort it out from
The image belowChanges in Japan-US policy interest rates from the COVID-19 pandemic to the presentIt is.
![[Nikkei Average] Looking back from the historic crash to rapid recovery (2024/08/05 to 2024/08/16)](https://sgsnsimg.moomoo.com/sns_client_feed/182788736/20240817/1723858468404-024a482b6f.png/big?area=105&is_public=true)
In 2020/3, the United States was concerned about the economic recession due to COVID-19, and the actualStart a zero interest rate policy。
On the other hand, as you know, Japan originally had negative interest ratesNo changes。
There is almost no difference in interest rates between Japan and the US at this point.
What changed drastically was the 2022/3 policy interest rate, from the FOMC in the US.
Although the economic recession due to COVID-19 has been stopped, the heat of the economy has risen too much all at once, and this timeInflation is a concernIt will now be done.
from hereUS starts raising interest rates all at once. MeanwhileJapan is not doing anything。
If that happens, it will inevitablyLarge interest rate differences between Japan and the USIt goes without saying that they will be born.
The yen carry trade is booming in the US
There is no way that American institutional investors will overlook this interest rate difference.
It is an interest rate difference between Japan and the US that is unparalleled in history, and in the USCircle carry tradeThere is a big boomIt will be.
What is the so-called “carry trade”Interest rate difference incomeIt's like getting it.
When interest rates on the dollar are high and interest rates on the Japanese yen are lowRaise Japanese yen, exchange it for dollars, and earn interest rate difference profitsYou will now be able to see this movement.
Up to this point, it's a common carry trade,That alone didn't stop the situation.
Focusing on American institutional investors,
① Procurement of Japanese yen with low interest rates
②Exchange to US dollars (Buy dollars sell yen)
③exchangedBuy US stocks with dollars
④Raise Japanese yen again using US stocks as collateral
⑤With the Japanese yen we procured~ Below is an infinite loop
There will be a huge boom in such deals.
Do you know that something so horrible is happening that it cannot be conveyed by letters alone?
In other words, investorsA de facto two-story trade that aims to profit from rising US stocks while earning profit from interest rate differencesThey were doing it.
No, since they use the shares they bought as collateral to raise funds again to buy stocks, I don't even want to imagine how many floors of trade it actually was.
The coming collapse of the yen carry trade
When I learned about this reality, I felt something like the Lehman shock.
Looking back, it was a situation where even during the Lehman shock, people made subprime loans to buy houses on the grounds that the US housing market was doing well, and they also made loans using the house as collateral to buy houses.
The yen carry trade tooThe products are different, but what they are doing is the same as during the Lehman shockIt is.
[US] ・Employment and the economy are strong, and inflation is unstoppable.
⇒ Interest rates cannot be cut
[Japan] ・Bank of Japan Governor Ueda has consistently taken a dovish attitude
・There is a large amount of national debt
⇒ Interest rates cannot be raised
The yen carry trade progressed more and more against the backdrop of this strong fact.
butThe situation changed suddenly at the Bank of Japan monetary policy meeting held on 2024/7/31I will.
The Bank of Japan announced interest rate hikes, and even moreThe attitude of hawks at the press conference after the meetingI showed it to you.
In response to the results of the US employment statistics that were announced to further drive them downConcerns about the US recessionhas surfaced.
As described above, the two-story yen carry trade, which had been booming in the US, was actively traded based on the basis of the half-rule that the US could not cut interest rates and Japan could not raise interest rates.
It all came crashing down overnight.
Investors who were carrying trades sold dollars (yen buying) all at once in response to a sudden reversal without warning, and behind that, US stocks also plummeted in response to concerns about a recession in the US economy.
As I've said many times over, it's a trade with many floors, so the speed at which losses increase when rotating in reverse is ridiculous (vocabulary).
Japan Stock X Day has arrived
In response to the US stock crash last night and the rapid appreciation of the yen, the Nikkei Stock Average fell ridiculously from a standstill.
Now, let's summarize the factors behind the 8/5 X Day crash.
Governor Ueda's hawkish stance (interest rate hike mood) /US recession concerns/sharp fall in US stocks the night before/rapid advance in yen appreciation due to yen carry trade rewinding/futures sales to cover losses of institutional investors/automatic trading such as Argo is also triggered by saling/individual investor throwing sales
Exactly, sales lead to sales, and it was a day where all conceivable factors of decline were released at once.
Incidentally, as an aside,This day in particular[Bank stocks]The big one was soldHowever, intuitively, “why were bank stocks sold when interest rates were raised?” I think there are many people who have wondered.
Regarding this, please remember the yen carry trade we are introducing.
Overseas players were raising Japanese yen. Exactly from a Japanese megabank.
What clearly confirms this is the recent financial results of major megabanks, starting with Mitsubishi UFJ.
I hope you can take a look when you have time, but what contributed greatly to business results was overseas loans.
In other wordsBank stocks were sold because they were profiting from demand for funds in the yen carry trade, and since it depreciatedThat's why.
It really is a great place to shop
Now, as you all know, I do streaming activities on TikTok and YouTube, but I try to broadcast from a flat position without talking too much about my market price.
TikTok: The story of a stock store
Youtube: The story of a stock store
justContrary to total pessimism, a video referring to this day as a perfect place to shop was distributed on TikTokI did.
Of course, as mentioned many times in the video, it's not a story recommending a purchase. It's just my personal opinion.
However, until a while ago, I have mentioned the cause of the decline in Japanese stocks, which is bland,As a result, I realized that the Bank of Japan only raised interest rates by 0.15%, and “maybe” the US economy will recede, and this is the only reason.
nothingThere was no financial collapse like the Lehman shock, nor did a pandemic like the coronavirus occurBut the Nikkei average for 2024/08/05 is...
PER 13.01 times, thisDefinitely buyI intuitively thought so.
Immediately, preparations for the purchase will begin on the morning of 8/5. As a modus operandi, I first bought the first one at around 10:00 a.m. on 8/5.
The image is a 5 minute chart of Nikkei average futures from 8/3 to 8/5.
Of the image□Looking at the candlesticks surrounding it and the intense turnover at that time, I thought this was the selling climax, and I took the plunge and bought it, but as you all know, it was a low price cut as a result, so the position I took included the position I took, and the loss rapidly expanded.
Incidentally, what I bought big was not individual stocks, but the Nikkei Average futures for the month of December.
What are the reasons for choosing futures instead of individual stocksI felt that the entire index called the Nikkei Average was valued, and since I wanted to hold it until around December if the market price settled down, and since it was even more financially efficient than margin trading of individual stocks, I thought I could make a big profitIt is.
And above all,If you turn it into individual stocks even though you feel that it's completely cheap, you won't be able to get maximum value in the unlikely event that bad news comes out in the individual stocks you've selectedI thought,What has the highest expected value now is to buy the entire index in a basketThat's because I felt like that.
At this time, Japanese stocks closed with reasonably large unrealized losses.
And that night,US July ISM Non-Manufacturing Business Indexhas been announced.
The results are”Strong”. In other wordsThe US economy wasn't in such a recession that the market was factored inThat was the result.
As soon as I saw this, I bought more futures. The price movement was so tremendous that I couldn't think of it as a night session, and it was such a strong increase that there were no unrealized losses this morning at all.
They are all market purchases. I thought I could get the price range no matter where I grabbed it around here, so I'm not waiting for a push.
Incidentally, the results of the CPI announced after that were also strong, and concerns about the US recession have calmed down, but what remains questionable here”So why were the results of the employment statistics poorThat's the point.”
As a result of investigating this in my own way, apparently there was a large-scale hurricane in the United States during the aggregation period of employment statistics the other day, and I speculated without permission that the number of unemployed people had greatly surpassed the expected value due to its effects.
Thus, concerns about the US recession were mitigated, and while funds from speculators who carried out yen carry trades were also missing, both US stocks and Japanese stocks recovered rapidly thereafter, and now the Nikkei Stock Average is around 38,000 yen.
Of course, no one knows what will happen after this, and as expected, I think they are recovering too fast, so I would like to make my last 3 purchases with the aim of getting ahead from here on.
What kind of deals have you made during this turbulent week or two?
*───── [Person who wrote this post] ─────*
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Shison : Stock shop
I'm new to stocks and it's hard to understand all of the stock shop's posts, so I can't comment, but I respect them
株屋の立ち話 OP Shison : Sorry for the difficult content 🥹
I'm talking to myself, so don't worry about it...!
It's great to have a comment!