Japan's stock market has room to go even higher, analysts say (2024)

FAQs

What is the Japan stock market error? ›

Botched Stock Trade Cost Japan Firm $225M: Government Watchdog Rebukes Stock Exchange, Broker. A Japanese securities firm employee made an error when placing a sell order. Instead of selling 1 share at 610,000 yen, the numbers were reversed and 610,000 shares were sold for 1 yen causing mayhem in the Japanese market.

Tokyo stocks fell sharply on Friday amid concern about slowing semiconductor demand and worries conflict could spread in the Middle East. Investors unloaded shares across the board with chip-related stocks bearing the brunt of the sales.

The Nikkei is price-weighted, which means the index is an average of the share prices of all the companies listed. Because each company's stock is weighted by its price per share, the Nikkei tends to be influenced by high-priced stocks such as technology stocks.

The Nikkei 225, or the Nikkei Stock Average (日経平均株価, Nikkei heikin kabuka), more commonly called the Nikkei or the Nikkei index (/ˈnɪkeɪ, ˈniː-, nɪˈkeɪ/), is a stock market index for the Tokyo Stock Exchange (TSE).

Tokyo has already shown it means business. In less than three years, Japan has earmarked about ￥4 trillion ($26.7 billion) for revitalizing its semiconductor punching power with Prime Minister Fumio Kishida targeting financial support for the industry to eventually reach ￥10 trillion with private sector support.

Japan's overall trade surplus is a result of its exports in the rubric machinery, scientific and optical equipment, telecommunications equipment, and semiconductors and electronic parts.

Japan's relative weakness also reflects a decline in its population and lagging productivity and competitiveness, economists say. Japan's economy is now the world's fourth-largest after it contracted in the last quarter of 2023 and fell behind Germany.

Furthermore, we forecast earnings per share growth for Japanese stocks to be 6.2% in 2024, outperforming all the other developed markets,” explains Luca Paolini, a strategist with Pictet. It is an improvement in business profits that is also supported by the weakness of the Japenese yen, which has increased exports.

Despite the record highs, analysts generally believe that Japanese stocks are currently not overvalued. The Tokyo market's price-to-earnings ratio stands at around 16, in contrast to 23 for both the S&P 500 and the Sensex. For the year 2023, Nikkei 225 witnessed a return exceeding 28%.

Shanghai .SSEC:Shanghai Stock Exchange.

Who owns the Nikkei 225? ›

Nikkei 225 is used around the globe as the premier index of Japanese stocks and is very popular with Japanese retail investors particularly. It is calculated and published by a Japanese newspaper publisher Nikkei Inc.

Japanese equities offer quality large caps, the market is highly liquid, and with recent share buy-backs investor perceptions are changing. Additionally, corporate reform remains a powerful force for unlocking value in the Japanese stock market.

1. Takashi Kotegawa: Japanese trader turned $13,000 into $153 Million in just 8 Years, trading stocks from his bedroom. 2.

TOKYO – Japan's government rebuked the Tokyo Stock Exchange and one of the country's biggest brokerage firms Friday after a typing error caused Mizuho Securities Co. to lose at least 27 billion yen ($225 million) on a stock trade.

Due to the Bank of Japan's continuous financial deregulation, the Japanese economy has gradually reversed from deflation to inflation in recent years. Commodity prices are rising sharply. However, ordinary people's salary raises aren't keeping pace.

Mizuho Securities Co. in December 2005 mistakenly offered to sell 610,000 shares of employment agency J-Com Co. for 1 yen each, instead of one share for 610,000 yen, something the firm blamed on a typing error.

Another key factor behind Japan's sluggish growth is stagnating wages that have left households reluctant to spend. At the same time, businesses have been invested heavily in faster growing economies overseas instead of in the aging and shrinking home market.