After topping bubble-era highs, Goldman Sachs Research says Japanese stocks are poised to rise even higher.
Japan’s Nikkei 225 stock index closed above 40,000 on March 4, setting another record high after climbing last month above levels last seen decades ago. The broader Tokyo Stock Price Index, or TOPIX, has also rallied this year, approaching all-time highs. The Nikkei gained 28% and the TOPIX 25% last year.
Two important structural changes are playing out in the Japanese stock market: The country is shifting to an inflationary economy after years of deflation, and corporate governance reforms are taking root, strategists Kazunori Tatebe and Bruce Kirk write in the team’s report.
Fidelity Japan Trust PLC (LON:FJV) aims to be the key investment of choice for those seeking Japanese companies exposure. The Trust has a ‘growth at reasonable price’ (GARP) investment style and approach – which involves identifying companies whose growth prospects are being under-appreciated or are not fully recognised by other investors.