Despite the American election turmoil, both of Japan’s major stock gauges posted their best weekly gains since May. “Since 1980s, if you look at U.S. Presidential election and stocks, you see that stocks will price in any risks before the election, like we saw in September and October when technology stocks corrected,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities Co. “Once the election is over, there’s a trend for equities to rise with expectations for the next administration.”
Fujito sees a chance for the Nikkei 225 to reach 25,000, as central banks globally eye additional easing measures to stimulate economies. The Federal Reserve left its rates in hold Thursday but opened the door to a possible shift in its bond purchases in coming months, saying that more fiscal and monetary support are needed amid rising Covid-19 infections.
The Nikkei-225 hit a new closing high today and was up in a dynamic manner over the balance of the week. It may be in the process of completing an almost three-year range. The move was led by the market’s big industrials like Nippon Steel and Kobe Steel. The market is betting on infrastructure-led global reflation.Click HERE to subscribe to Fuller Treacy Money Back to top