After the Bank of Japan recently announced a farewell to negative interest rates and raised interest rates for the first time in 17 years, Buffett has taken another step.

According to Bloomberg, Berkshire, a subsidiary of “stock god” Buffett, plans to issue yen bonds globally again. Buffett's move has sparked market speculation, and he may be considering continuing to increase investment in Japan.

Goldman Sachs Asset Management (GSAM)'s latest opinion also stated that since US technology stocks may face pullback pressure, the company favors energy stocks with low valuations and high potential currently, and the Japanese stock market. The bank said that it chose to overmatch the Japanese stock market due to Japanese corporate reforms, improved corporate sentiment, and relatively low valuations.

In fact, since this year, the Nikkei Index has set a number of records: breaking the 34-year high record and breaking the 40,000 mark for the first time in history...

As can be seen from the top ten bullish stocks in Japan this year, compared with bank stocks and real estate stocks that led the Japanese market 30 years ago, the five major trading companies, the automobile, chip, and industrial technology industries are becoming the main drivers of this round of rebound, and they all have real reasons to attract investors to buy.

Since this year, among the five major trading companies$Mitsubishi (8058.JP)$,$Mitsui (8031.JP)$The cumulative increase was 59.62% and 38.88%, significantly outperforming the Nikkei Index.

Previous articles“The biggest increase of over 140% since last year! What kind of magic do Japan's top five trading companies have that make stock god Buffett love it?”It was also mentioned that diversified business, high dividends, high free cash flow, and prudent issuance of new shares are important reasons why Buffett favors the five major trading companies.

Recently, as Berkshire plans to issue a new round of yen bonds, it has once again stimulated the rise of the five major trading companies. According to Japanese media,

Berkshire's issuance of yen bonds is expected to take place within the next few days, but the exact amount is unknown, and it is unclear how Berkshire will allocate the funds raised. However, some investors speculate that they will increase their investment in Japanese assets, such as increasing their holdings in trading companies' shares.

Overall, the stock prices of Japanese trading companies have maintained a consistent rise with the Japanese stock market, and their solid profit base has attracted a large number of investors to enter the market. On the one hand, Buffett's investment has increased the popularity of these Japanese companies; on the other hand, it has indeed paid off handsomely due to the performance of these companies themselves.

Also, the previous article“Comparable to the Seven Heroes of the Stock Market! With the strong rise of Japan's “Seven Samurai,” who will once again set off an investment frenzy?”Global semiconductor equipment materials giants mentioned in$Disco (6146.JP)$, Japan's largest semiconductor manufacturing equipment provider$Tokyo Electron (8035.JP)$As well as car giants$Toyota Motor (7203.JP)$It also recorded impressive gains this year, rising 58.81%, 54.11%, and 45.96% respectively.

It is worth noting that in addition to the five major trading companies and the Seven Samurai of Japan, which are popular in the market, there are also many high-quality companies in the Japanese market.

For example, the hidden king of Made in Japan$Hitachi (6501.JP)$, the mysterious giant in the automotive industry$Denso (6902.JP)$, Japan's largest insurer$Tokio Marine Holdings (8766.JP)$, Japan's top bank$Sumitomo Mitsui Financial Group (8316.JP)$As well as Japanese investment giants$SoftBank Group (9984.JP)$.

• Hitachi, the hidden king of Japanese manufacturing

Hitachi has a history of over 100 years since its establishment. This company has evolved from an initial repair shop that manufactures motors to a diversified enterprise covering home appliances, energy, heavy machinery, information and communication, semiconductors, etc., with more than 18 types of business, controlling more than 1,000 subsidiaries behind it, and has grown into one of the largest manufacturing companies in Japan. It was once described by the industry as “capable of producing everything.”

The company has increased by nearly 40% this year. Looking at the long-term timeline, since the 2020 low, the company's cumulative increase has exceeded 350%.

• The mysterious giant in the automotive industry - Nippon Denso

Established in 1949, Nippon Denso is Japan's leading supplier of auto parts and is currently one of the top suppliers of automotive system components in the world. Car giants such as Toyota, Honda, Mazda, Mercedes-Benz, BMW, Audi, Ford, Geely, and Changan are all buyers of electrical equipment.

According to the 2023 list of the top 100 global auto parts suppliers released by “American Auto News”, Denso directly surpassed Bosch (US$50.456 billion) with revenue of 47.9 billion US dollars, ranking second on the list. Meanwhile, in Japan, there is a saying in the business community: if Toyota is the sun among Japanese car companies, then Denso is a sunspot.

In terms of stock prices, this company is also a dark horse. The increase this year was close to 40%, once reaching a record high.

• Japan's largest insurer - Tokio Marine Holdings

Tokio Marine is the largest property insurance company in Japan, and its development idea is to expand overseas business through mergers and acquisitions.

Tokio Marine Holdings was founded in 1879 and has now developed into a global insurance company. Overseas business is an important source of profit contribution for the company. In 2023, international business contributed 56% to the company's profit.

According to the Guolian Securities Research Report, around 2000, the company established the idea of global operations. The main reason was that domestic insurance demand weakened due to the downturn in the Japanese economy, and vicious competition in the industry caused financial insurance companies to lose money seriously. When entering overseas markets, the company adopted different strategies for different regions.

For emerging markets, the company's main development strategy is to seize the insurance business growth opportunities in emerging markets and expand the financial insurance and life insurance business from within Japan to the region.

For mature markets such as Europe and the US, the company's main development strategy is to expand the insurance market and increase market share in the region through mergers and acquisitions. As the company's international business expansion process deepens, the company will expand its asset classes by acquiring small companies, and will also optimize asset allocation by selling inefficient businesses.

After long-term development and mergers and acquisitions, the scale of the company's financial insurance premiums continued to grow. In 2022, Tokyo Marine's financial insurance premium income increased 15% year-on-year to 4.5 trillion yen.

Judging from Tokyo Marine's stock price performance, the company's absolute earnings and relative earnings have been significantly positive since 2010. Since 2010, Tokio Marine's stock price has increased by 467.28%, and the Nikkei 225 Index has risen 273.99%. The company's excess earnings compared to the Nikkei 225 Index are +193%. The company's stock price rose significantly and excess earnings were significantly positive, mainly due to the company's excellent underwriting profitability.

• Japan's top bank - Sumitomo Mitsui Finance

Sumitomo Mitsui Financial Group is the second-largest financial institution in Japan. The group operates in the fields of banking, leasing, securities, credit cards, and consumer finance.

As the Bank of Japan decided to end its negative interest rate policy, Bank of Japan stocks rose in response. Sumitomo Mitsui Finance accumulated a cumulative increase of more than 31% during the year, surpassing the increase for the full year of last year.

• Japanese investment giant - SoftBank Group

SoftBank Group is a Japanese multinational investment holding company. The group mainly invests in technology operating companies that provide customers with products and services in many markets and industries, from the Internet to automation. With an initial capital of over $100 billion, SoftBank Vision Fund is the world's largest technology-focused venture capital fund.

Thanks to a rebound in the value of shares held by Vision Fund and a “windfall” of T-Mobile US Inc. shares, SoftBank Group achieved profits after four consecutive quarters of losses.

Net profit for the fourth quarter of 2023 was 950 billion yen, reversing a loss of 783 billion yen for the same period last year. This is the first time since September 2022 that SoftBank has achieved quarterly profit.

Furthermore, chip design giant ARM is also silently assisting SoftBank behind the scenes. Judging from this year's trend, SoftBank's cumulative increase was more than 34%, the biggest annual increase in nearly 4 years.

Cow friends,

Which company are you most interested in?

Welcome to leave your opinions in the comments area~

Editor/Somer