The Nikkei touched a fresh two-month high this week, a sign that concerns about Japan’s economy are fading, analysts say.
“We remain bullish [on Japan stocks] – we went through a difficult patch in the first quarter and took some pain on that trade, but I think it’s still the most logical place in the region,” said Sean Darby, chief global equity strategist at Jefferies. “Real rates are negative, there is ongoing stimulus and the corporate sector is starting to re-engineer its balance sheet.”
Stocks powered higher on Thursday, to reach 15,141 soon after open, it’s highest level since April 3.
Last year, Abenomics – Prime Minister Shinzo Abe’s plan to boost Japan’s economy through aggressive easing, fiscal stimulus and structural reform – saw the Nikkei rise 55 percent, while the yen depreciated 21 percent against the U.S. dollar boosting exporter stocks.