Morgan Stanley notes Japanese Stocks being resilient amid economic downturn

08 September 2022 324
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Japanese stocks have greater opportunity to resist peers’ pressures in the face of mounting recession risks, as Morgan Stanley claims.


"Japanese stocks have traditionally lagged behind the global slowdowns," mentioned analysts led by Daniel C. Blake.


The broker retains its surplus on the Topix and considers Japanese stocks cheap. The Bank of Japan’s fiscal policy is unlikely to be tightened, seeing the limited inflation, as opposed to continued rate hikes in other states.


This discrepancy may assist in maintaining a continuing weakness of Japanese currency, even in the case of its falling to 24-year lows towards the dollar. The following circumstances could be beneficial for domestic exporters. However, a recent easing of pandemic restrictions is supposed to help recover the Japanese economy. 


"The country’s more conservative approach to Covid loosening and employment stimulation programs implies that the economic state of Japan is different compared to others. Currently, it is benefiting from a gradual pace resumption,” the analysts wrote.


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This content is for informational purposes only and is not intended to be investing advice.

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