The US stock market was closed for the Labor Day holiday. Tadashi Kakuchi, portfolio manager of the Japan Bond Investment Portfolio at PIMCO Japan Branch, expects the Bank of Japan to raise interest rates again as early as January next year; although there was geopolitical uncertainty and financial market instability in August, the Bank of Japan's monetary policy normalization direction has not changed. The yen rose 0.2% in the Asian session, with the US dollar falling to 146.57 against the yen. The Nikkei index opened high by 44 points this morning (3rd), rising by 266 points at one point to a high of 38,967, encountering resistance, and closing up by 86 points or 0.2% at 38,787 by midday.
Major banks/investment bank stocks generally rose, with Nomura up 1%, Mitsubishi UFJ, Mizuho, and Sumitomo Mitsui rising by 1.6% to 2.2%, and Resona Holdings up by 3.9%. Daiwa Securities remained stable.
Weighted/popular stocks generally rose, with SoftBank, Fast Retailing slightly up by 0.2% to 0.5%, TEPCO, Rakuten, Seven & i Holdings up by 2% to 2.1%. Major automobile stocks Toyota, Nissan, Mitsubishi Motors, and Honda rose by 0.3% to 2.1%.
Chip and related equipment stocks were under pressure against the market trend, with Tokyo Electron, Advantest slightly down by 0.7% to 0.8%. Shares of Fujifilm Electric, Murata Manufacturing, Sumco, Disco Corp, SMC Corp, Tokyo Seimitsu, and Lasertec Corp fell by 1.5% to 3.2%.
UBS Wealth Management Investment Director's office released a report, pointing out that with the stabilizing USD/JPY exchange rate and reduced concerns over US growth, the Japanese stock market quickly rebounded after a sharp drop at the beginning of August. The TOPIX index rebounded by 20% after a deep decline, and the PE valuation also rose to 14 times (previously decreased from 16 times to 12 times). However, Japanese bank stocks (still down by 20%) and electronic components and semiconductor equipment (down by 10% to 20%) have significantly lagged behind. Despite the possibility of a slowdown in the overall market rally, due to strong fundamentals and attractive valuations, the bank is bullish on buying the above-mentioned stocks at a lower level. The current market price-to-book ratio for Japanese bank stocks is less than 0.8 to 0.9 times.