This year’s rally in Japanese stocks, which has driven the Topix to its highest level in more than three decades, is set to extend as earnings growth, share buybacks and still-low valuations tempt buyers.
That’s the view from CLSA Securities Japan and Monex. A promising earnings season has been the latest catalyst for Japan equities, which were boosted by Warren Buffett’s renewed endorsement and corporate governance improvements.
Though not spectacular, Topix firms are forecasting operating profits to rise about 6% in the fiscal year ending March 2024. History shows that companies tend to be conservative.