Fall Market Outlook: High-Tech and Accessories Expected to Soar, Despite Poor NY Dow Performance

Economic commentator predicts high demand for high-tech and accessories in the fall market

The NY Dow’s poor performance in September may impact market development

New York – As the scorching summer heat subsides, a typhoon is approaching the Tokyo metropolitan area, signaling the arrival of autumn. Despite forgetting the seasonal transition due to the lingering heat, it’s undeniable that September has already commenced, marking the beginning of the autumn market. In the previous summer market, there were surprising price movements in major stocks related to domestic demand. However, the focus now shifts to the market’s performance in September and October.

The NY Dow’s historical performance in September reveals a decline of 2.3% in 2020, 4.3% in 2021, and a notable 8.8% in 2022. Experts anticipate that this trend will likely impact the Nikkei Stock Average. Two pivotal events to watch in the coming weeks are the publication of the US Consumer Price Index (CPI) rate of increase in August on the 13th and the quadruple witching on the 15th, which may drive market sentiment.

Attention will then turn to the Federal Open Market Committee (FOMC) meeting scheduled for the 19th and 20th of this month, where it is predicted to be a relatively calm gathering with no changes in interest rates. Notably, the Tokyo Stock Exchange recently permitted the listing of six actively managed Exchange Traded Funds (ETFs) for the first time. Previously, only index-tracking ETFs were permitted, but the growing popularity of actively managed ETFs globally prompted this expansion in options.

The six ETFs introduced are as follows: Simplex Asset Management’s “PBR 1x Elimination Promoting ETF,” “ETF promotes retention and cancellation policy,” and “Investor Management ETF.” Additionally, Nomura Asset Management presents the “NEXT FUNDS: Japan Growth Stock Exchange Traded Fund” and “NEXT FUNDS Japan High Dividend Active Stock Trading Fund,” while Mitsubishi UFJ Kokusai Investment Trust introduces the “MAXIS High Dividend Active Japanese Stock Exchange Traded Fund.” These newly listed ETFs center around keywords like “PBR,” “high dividends,” and “eliminate cross holdings.” Interestingly, Nomura Asset Management’s offering aligns with the upcoming “Japan Weeks” event organized by the Financial Services Agency, which aims to promote Japan’s appeal as a financial and capital market.

Anticipating material shortage in core stocks, while high-tech items gain momentum

Looking ahead, investors anticipate the possibility of material shortage in the short term, particularly for core stocks. The ex-dividend date for September, estimated to be on the 28th, could lead to a substantial buying demand for Nikkei 225 and TOPIX futures. According to Daiwa Securities’ estimates, this buying demand could exceed 150 billion yen and nearly reach 900 billion yen, respectively.

On October 2nd, the regular rearrangement of stocks included in the Nikkei Stock Average is scheduled, which may trigger a significant cash sell-off of approximately 410 billion yen. Conversely, following the conclusion of events like the calculation of a Specially Clear Futures Index/Options, sectors such as “low PBR” and “high dividend” that experienced heightened interest from July to August are expected to prioritize profit-taking. This may lead to a surge in demand for previously sluggish small items, including high-tech products.

Investors are particularly eyeing stocks like Daikoku Electric, Takamizawa Cybernetics, quest, ABEJA, and Japanese, expecting favorable returns. Meanwhile, for those considering long-term growth potential, Lynette Japan Group, involved in recycling and welfare services for people with disabilities, as well as Micread, which supports Tohoku’s fishing industry, and Tobira Systems, known for its nuisance call-blocking system, present intriguing investment opportunities to explore.

As September progresses, market participants are advised to stay informed about these pivotal events and carefully assess the shifting dynamics in various sectors. Times are changing, and thorough analysis coupled with strategic decision-making will prove essential for navigating the ever-evolving market landscape.

– Diary of September 8, 2023 –

Stock Search News

  • About the NY Dow’s September performance
  • Impact on the Nikkei Stock Average
  • Newly listed actively managed ETFs on the Tokyo Stock Exchange
  • Upcoming key events: FOMC meeting, Japan Weeks
  • Possible material shortage in core stocks
  • Rearrangement of stocks in the Nikkei Stock Average
  • Trends in sectors like low PBR and high dividend
  • Potential growth opportunities in high-tech and other sectors

Economic commentator Tomio Sugimura
“High tech and accessories will be bought in the fall market!”

● The NY Dow performed poorly in September!

Although the intense heat has subsided, a typhoon (No. 13 hitting the Tokyo metropolitan area) is on its way. No, I’m busy. The autumn red spider lilies have finally started to bud. It is about two weeks late. It was so hot I must have forgotten the season. But it’s already September. The autumn market has started. The summer market saw unexpectedly strong price movements focused on large stocks related to domestic demand, but how will the market develop in September and October?

In fact, the NY Dow’s performance in September was poor. It was -2.3% in 2020, 4.3% in 2021, and 8.8% in 2022. This will affect the Nikkei Stock Average. In terms of time frame, the key points will be the August US CPI (Consumer Price Index) rate of increase published on the 13th and the quadruple witching on the 15th.

The FOMC (Federal Open Market Committee) meeting on the 19th and 20th will likely be quiet (this time, interest rates will be left unchanged). In the Japanese market, six actively managed ETFs (exchange traded funds) were listed on the Tokyo Stock Exchange for the first time on the 7th of last week. Until now, the TSE had only allowed index-tracking ETFs to be listed, but globally the proportion of actively managed ETFs is increasing rapidly.

The six stocks this time are Simplex Asset Management’s “PBR 1x Elimination Promoting ETF”. <2080> “ETF promotes retention and cancellation policy <2081> ” “Investor Management ETF” <2082> ”, “Nomura Asset Management’s NEXT FUNDS: Japan Growth Stock Exchange Traded Fund” <2083> ” “ NEXT FUNDS Japan High Dividend Active Stock Trading Fund <2084> ” and “MAXIS High Dividend Active Japanese Stock Exchange Traded Fund,” created by Mitsubishi UFJ Kokusai Investment Trust. <2085> ” This is one of the books.

The keywords for the six ETFs are “PBR”, “high dividends”, and “eliminate cross holdings”. Nomura Asset Management’s “growth stocks” are unique. These themes coincide with “Japan Weeks” (an event sponsored by the Financial Services Agency which disseminates measures towards the realization of an international financial center and Japan’s appeal as a financial and capital market) from September 25th to October 6th.

● Will core stocks run out of material in the short term?

Furthermore, the ex-dividend date for September (28th) is estimated to be 225 yen for the Nikkei Stock Average and 20.8 points for the TOPIX. If all related passive assets move to buy futures due to ex-dividends, there will be a buying demand of over 150 billion yen for Nikkei 225 futures and just under 900 billion yen for TOPIX futures (estimated by Daiwa Securities).

On the other hand, on October 2nd, the stocks included in the Nikkei Stock Average will be regularly rearranged.Mercury for new hires <4385> [東証P]laser technology <6920> [東証P]Nitori’s holdings <9843> [東証P]excluding Nippon Sheet Glass <5202> [東証P]Mitsui E&S <7003> [東証P]Matsui Securities <8628> [東証P]in. It is expected that 410 billion yen will be sold for cash.

On the other hand, in terms of search, sectors such as “low PBR” and “high dividend”, which have been at a fever pitch from July to August, will be prioritized for profit-making, following the end of events such as SQ ( calculation of a Specially Clear Futures Index/Options) Will develop. As it is called, in the short term, we run out of materials. On the other hand, small items (growth) which were sluggish in September-October, including high-tech items, will be bought.

In other words, Daikoku Electric <6430> [東証P]Takamizawa Cybernetics, incl <6424> [東証S]quest <2332> [東証S]、ABEJA <5574> [東証G]Japanese <9558> [東証G]、 <9166> [東証G]We can expect a return like this.

Additionally, considering the potential for growth, Lynette Japan Group, involved in recycling and welfare services for people with disabilities, <3556> [東証G]Here is a link related to Hanshin professional baseball <4372> [東証G]Micread supports Tohoku’s fishing industry. <7687> [東証G]Tobira Systems, a nuisance call blocking system <4441> [東証P]It would be interesting to see something like that.

Diary of September 8, 2023

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