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Japanese stocks are down as insurance companies fail to deliver positive news to the market with investors considering the new growth strategies of the nation. The Topix index declined for the second time this week.
Among the Topix 33 industry group, the insurance company paced the decline with a 1% loss in shares. The Topix Index fell by 0.3% to 1,265.08, 9:39 am, Tokyo time. The trend showed that for every three shares that lost, two gained. The Nikkei 225 slumped by 0.5% to 15,298.46 as the yen kept stable at 101.94 a dollar.
Equities manager at SMBC Nikko Securities Inc., Hiroichi Nishi said that while shares appear overbought right now, it is for the short-term and that there are high hopes for the future. This means that, according to him, the market of today will experience minor declines and then continue to trade ‘sideways’. He added that in the case of a weak yen, the market might make a bigger come back when the session closes today.
From May 21 up until yesterday, the Topix had advanced approximately by 10%. It surpasses the performance of the MSCI World Index during the mentioned time frame.
Prime Minister of Japan, Shinzo Abe, said in an interview yesterday that deflation has ended and will be overthrown by the government’s new policies whose aim is to expand businesses across the nation. He then let his cabinet endorse the new policies.
According to the new government policy, Japan will be cutting off corporate taxes from the fiscal year of 2015. In theory, this will lower the rate to less than 30% within a few years. Other strategies introduced were the creation of a corporate governance code and an increase in the nation’s number of foreign workers.
