Tokyo Market Summary: “Fear of late purchases” behind the sharp rise in the Nikkei average of 329 yen to the highest price

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Bank of Japan Governor “carefully inspects” overseas economies and financial market trends
Bank of Japan Governor Ueda Kazuo stated at the House of Representatives Finance Committee on the 16th that “overseas economies and international financial market trends are one of the factors that have a significant impact on the Japanese economy and prices.” On top of that, he said, “We will carefully inspect internal and external situations and strive for appropriate policy management.”

“Fear of late purchases” behind the sharp rise in the Nikkei Average to the highest price
The Nikkei Stock Average continued to grow in the Tokyo Stock Exchange on the 16th, and the increase temporarily exceeded 700 yen compared to the previous day. The highest price in history (38,915 yen 87 sen) on a closing price basis set at the end of 1989/12 was reduced to about 50 yen. It was a tailwind that the three major US indices all rose, such as the S&P 500 stock price index breaking the highest value in the US stock market the day before. The current rise in Japanese stocks is surpassing US stocks, and the “fear” of investors who are late in buying is giving impetus to stock appreciation.

Establishing a “mid-sized enterprise”, cabinet decides on amendments to the Industrial Competitiveness Enhancement Act
On the 16th, the government decided on an amendment to the Industrial Competitiveness Enhancement Law to give priority support to companies with 2000 employees or less by newly legally positioning them as “medium-sized enterprises.” It also included preferential treatment for income obtained from domestic production of important goods such as semiconductors and intellectual property in terms of the tax system.

Listed companies had the highest profit for 3 consecutive terms, ending the fiscal year ending 24/3, with an increase of 3 trillion yen
The net profit of listed companies for the fiscal year ending 2024/3 is expected to hit a record high for the third consecutive term. It is 43.5 trillion yen, up 13% from the previous fiscal year, and 3.5 trillion yen higher than the initial forecast for the fiscal year in May last year. The resumption of the economy, the penetration of price increases, and the depreciation of the yen will boost earnings. $Toyota Motor(7203.JP)$Stock prices have also been updated one after another since listing, etc., and the movement of investment money flowing to companies that have increased earning power has become clear.

The Bank of Japan's total ETF holdings, which is expanding due to strong Japanese stocks, is comparable to annual tax revenue
While Japanese stocks hit a new high after the bubble period, exchange-traded funds (ETFs) held by the Bank of Japan seem to have swelled to a scale comparable to Japan's annual tax revenue, with a market value of about 70 trillion yen.

Be wary of rising volatility even if long-term interest rates exceed 1% before and after negative interest rates are lifted
As the cancellation period of negative interest rates by the Bank of Japan approaches, price movements of Japanese government bonds become rough, and market participants are wary of the possibility that long-term interest rates held in the 0.7% range will rise to a level exceeding 1% at once.

“The accommodative financial environment will continue for the time being” even after negative interest rates are lifted - Bank of Japan Governor Ueda
Bank of Japan Governor Ueda Kazuo once again expressed his view on monetary policy management on the 16th that an accommodative financial environment will continue for the time being even after negative interest rates are lifted. I answered at the House of Representatives Finance and Finance Committee. Governor Ueda explained that “we will examine the pros and cons of continuing various large-scale mitigation policies, including negative interest rates,” once the price stability target can be achieved sustainably and stably.

Nomura and Yamato raised their Japanese stock targets and exceeded 40,000 yen by avoiding a rapid appreciation of the yen
Nomura Securities set a forecast value for the Nikkei Stock Average at the end of fiscal year 2024 (end of March 25) at 40,500 yen, and a mid-term high of 43,500 yen. Until now, it has been estimated at 38,000 yen as of the end of December '24, which is a de facto increase. Daiwa Securities also revised its target from the previous 38,600 yen to 43,000 yen.

Featured stocks
Semiconductor-related stocks turned soft, and after the morning high, they were pushed by profit-taking sales
$Lasertec(6920.JP)$Ya $Renesas Electronics(6723.JP)$、 $Disco(6146.JP)$Semiconductor-related stocks, etc., were pushed to sell after morning high, and completely turned around and developed softly. Most of the main semiconductor-related stocks have been in the high price range since listing, and Lasertech continued to rise for 3 days until the day before, $Screen Holdings(7735.JP)$It also only surged 7 times in a row, and it seems that profit-taking sales became dominant after one round of buying.

SoftBank G to issue corporate bonds worth 550 billion yen - period of 7 years
$SoftBank Group(9984.JP)$It was disclosed on the 16th in the revised issuance registration form that corporate bonds of 550 billion yen would be issued. The redemption period is March 14, 2031.

Mercari rebounds drastically and invests in newmo, which aims to enter the rideshare business
$Mercari(4385.JP)$It has rebounded for the first time in 3 days due to a sharp rise. On this day, it was announced that they had decided to invest in NEWMO (Minato-ku, Tokyo), which aims to enter the rideshare business, and it is viewed as good news.

Mitsui & Co. - Expansion of market growth, sale of part of Brazilian transportation company shares, profit of approximately 26 billion yen
$Mitsui(8031.JP)$The range of improvements in the backfield has expanded. The company announced at 12:30 on the 16th that it will sell part of the shares of the Brazilian integrated cargo transportation company VLI it owns.

Sompo Holdings likes Japan's policy zero shareholding policy for daily high price non-life insurance
$Sompo Holdings(8630.JP)$It continues to grow. The high listing price based on stock mergers was updated daily to 8977 yen, which is 350 yen (4.05%) higher than the previous day. At the briefing session for investors held on the 15th, it was stated that policy holdings worth approximately 1.3 trillion yen held by Sompo Japan Insurance, which is under its umbrella, will be reduced to zero. It seems that buying has become dominant from the view that the movement to improve capital efficiency will progress further due to the sale of policy holdings.