Daily Brief Japan: Nippon Express Holdings, TSE Tokyo Price Index TOPIX, US Treasury (10 Yr Generic) and more

In today’s briefing:

Nippon Express (9147) Secondary Offering – Banks, Sompo, Others Sell – “2024 Problem” Looms
Will the Creation of a Private Stock Market Help Accelerate Industry Restructuring?
Bullish Outlook Intact; DXY Rolling Over; More Global Breakouts. Buys in Discretionary, Tech

Nippon Express (9147) Secondary Offering – Banks, Sompo, Others Sell – “2024 Problem” Looms

Today post-close, Nippon Express Holdings (9147 JP) announced a secondary offering. Total size is ~¥30bn before considering where it will price; 11-12 days of ADV, 4.6% of shares out.
Various banks, Toyota-related auto cos, and Sompo Japan will sell. This is a start to the unwind, but it is a very small portion of the total cross-holding position.
NX also announced an on-market buyback of up to ¥10bn to run from 11April -31July 2024. This, and index demand, mitigate some heaviness. But The 2024 Problem looms large.

With IPOs becoming a place for founders to recoup their capital, and the desire for post-IPO growth declining, IPOs are a place for retail investors to speculate using scarce liquidity.
If a market is provided that recovers funds without relying on IPOs, IPOs will become larger and more selective, which brings them closer to the investment focus of institutional investors.
The expansion of the private equity market will play a significant role in the “industry restructuring,” as more M＆As between private companies and public companies are expected to take place.

We continue to see more and more global indexes and Sectors breaking out to new highs. This is classic bull market behavior. The latest breakouts: Israel, Germany, and Sweden
Our bullish outlook (since early November 2023) on global equities (MSCI ACWI) remains intact; continue to ride this trend higher, and treat pullbacks as buying opportunities.
We continue to get more evidence suggesting the US Dollar (DXY) is rolling over, and quite likely that global sovereign 10-year yields are rolling over as well. Risk-on.

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