Today’s Japanese Stock Market Strategy
Strategies
- None
Explanation
Upon observing the overall market conditions, there was a lack of substantial information to actively engage in trading, leading to the inability to formulate a specific strategy. While there is a desire to focus on buying high-tech stocks, the momentum doesn’t seem to be as strong considering the situation in the United States. If any trading were to occur, it might revolve around earnings-related transactions.
The outstanding balance of arbitrage trading on October 23 was announced yesterday, showing a long position of +750,000 shares and a short position of -79.92 million shares. It’s unclear if this is a misinformation, but the figures are unusually large and need to be constantly monitored to understand the market dynamics.
Review of Today’s Japanese Stock Market
Key Events
- Lakus and Shimano saw significant gains following their earnings announcements, while Toei Animation and Obic experienced notable declines.
- REITs performed steadily.
- Cosmo Energy surged due to material related to Murakami Fund.
- Retail sector stocks like Zensho, Morinaga, and Saizeriya showed strength.
- MOTHERS market stocks such as Appier and Freee were notably weak.
- Japan Post and several regional bank stocks reached 52-week highs, indicating a continued influx of funds into the banking sector.
- GMOPG saw tremendous trading volume due to its recent rally.
- Futures prices plummeted significantly before the closing bell due to the dollar-denominated bankruptcy news of China’s Country Garden.
Explanation
Futures initially appeared strong but experienced a sharp decline following the news related to Country Garden in the 2 PM session. Ultimately, the market remained volatile throughout the day. Individual stocks showed mixed movements, making it challenging to identify potential profitable options during trading hours. Companies like Zensho, Morinaga, and Saizeriya demonstrated positive movements, but finding solid grounds for making purchases today was difficult. (Especially considering Saizeriya’s consecutive 52-week highs…)
Although there was an expectation for a growth-oriented market, it seemed that growth stocks were underperforming. The fact that Japan Post and regional banks reached their 52-week highs suggests that there is still demand for value stocks. Careful consideration is needed while evaluating potential investments.
Conclusion
The focus should be on earnings-centered trades.
