Never say never.
Japan’s Nikkei index on Thursday notched its first 10-day winning streak for the first time in 27 years on the back of a weak yen. The Japanese currency’s slippery slide against the greenback helped export-related counters. A strong overnight performance in European and U.S. stocks also energized investors.
The 225-issue Nikkei Stock Average ended up 78.88 points, or 0.39%, from Wednesday at 20,551.46. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 11.43 points, or 0.69%, higher at 1,672.76.
Asia Unhedged recalls when this last occurred in 1988, Noboru Takeshita was prime minister, Tokyo land prices were heading for the moon, investors were raking it in on the Tokyo Stock Exchange, and Americans thought Japan (not China) was taking over the world. All this before the Bubble Economy burst.
The U.S. Fed’s Janet Yellen helped drive the yen down over the last few days on comments that she expects to raise U.S. borrowing costs this year if the economy meets her forecasts. Bank of Japan Governor Haruhiko Kuroda also reiterated this week that monetary policy will be adjusted, if need be, to meet his inflation target.
Will the Nikkei keep going back — or is it forwards in time? Maybe.
“It’s likely that the yen will continue to slowly weaken and we’ll have a global risk-on mode, stocks won’t rise too quickly but they’ll have a steady climb,” Mitsushige Akino, executive officer at Ichiyoshi Asset Management told Bloomberg News.
Categories: Asia Unhedged