In today’s briefing:
- TOPIX Inclusions: Who Is Ready (Mar 2024)
- Japanese Bigger Cap Banks – Exit from BoJ’s Negative Interest Rate Policy Gathers Steam
- The Standard that All 1,600 Prime Market Companies Could Do Would Be Loose
TOPIX Inclusions: Who Is Ready (Mar 2024)
- Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
- There were no Section Transfers announced in January or February so currently there are no live TOPIX Inclusion events but there are some pre-event names to be monitored closely.
- The upcoming TOPIX flows in end-April 2024 will be more complicated than the other quarterly rebalances as there will be more flows due to the annual liquidity factor review.
Japanese Bigger Cap Banks – Exit from BoJ’s Negative Interest Rate Policy Gathers Steam
- The current “higher for longer” interest rates in the US and other developed markets adds to the Bank of Japan potentially ending its negative interest rate policy
- Domestically, news reports suggest that the BoJ’s 2% inflation target is increasingly likely to be met in the short term, which further drives the potential normalization of interest rate policy
- Growing expectation of the BoJ’s negative interest rate policy exit adds upside to Japanese bank shares, especially those geared into higher domestic interest rates; we like Resona, Mizuho and Concordia
The Standard that All 1,600 Prime Market Companies Could Do Would Be Loose
- TSE wants to make disclosure of financial statements in English mandatory, which many prime market companies do, and to require disclosure in both Japanese and English on the same day.
- The focus will be on expanding to English-language disclosure of documents such as annual securities reports and corporate governance reports, which are in high demand by overseas investors.
- Inadequate English-language disclosure has directly affected listed companies by preventing IR meetings from deepening dialogue and negatively impacting investment decisions.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
