Donald Trump’s election is having profound ripple effects across the global economy.
Japan is among the early beneficiaries of the president’s policies.
The Land of the Rising Sun recently enjoyed a healthy uptick in GDP, which makes its government debt far less frightening.
Political stability also looks likely going forward.
A weakening yen helps Japan’s exporters, too.
Add it all up and now is the perfect time to diversify into the Japanese market.
After all, it’s still selling at half its level of 27 years ago.
I asked my senior analyst, Martin Hutchinson, to reveal his top five bullish forces on Japan.
Hutch’s full analysis is below.
Ahead of the tape,
Louis Basenese
Chief Investment Strategist, Wall Street Daily
Bullish Force #1: Robotics
Japan’s robotics industry is the world leader, in terms of share of GDP, with over 250,000 robots currently in operation.
The country is uniquely accepting of robots among global cultures, with a robot-loving tradition that goes all the way back to the 1920s.
Consequently, robots are used in such areas as elder care, where they would not yet be accepted in the West.
Japan thus has a “first mover” advantage in what seems likely to be a seminal technology of the 21st century.
Bullish Force #2: Good Value
Japan’s benchmark — the Nikkei index — sits around 19,000, compared with its all-time high of 38,916 set on Dec. 29, 1989. So Japanese stocks presently trade for roughly half their 1989 level.
That means you don’t have to worry about buying overpriced assets.
It also means that the market has plenty of upside ahead.
Bullish Force #3: Real Growth
Japan’s economy is finally growing efficiently, with fourth-quarter real GDP 1.2% above the previous year.
Now, bear in mind that Japan’s population is shrinking, so growth figures per capita are higher than raw growth figures.
