Japan’s Topix stock index has reached its highest level since August 1990 as foreign investors pile back into the Asian market.
The Tokyo Price Index, also known as Topix, has gained more than 6% this year. The broad-based index, comprised of about 2,000 stocks, has outperformed other indices across Asia.
The rise in the Topix has been led by utilities, consumer cyclicals, technology and financial stocks. Well-known stocks that have helped to lift the Japanese index include Softbank (TYO: 9984), Sony (SONY) and Nintendo (NTDOY).
Data shows that foreign investors bought a net $15.4 billion U.S. worth of Japanese stocks in April of this year.
Japan’s Nikkei 225 index has also risen in recent months and is now at its highest level since November 2021, led by industrial stocks. The Nikkei recently topped the psychological level of 30,000.
Shares in Japan’s top five trading houses have been given a boost after Berkshire Hathaway (BRK.B) CEO Warren Buffett raised his stakes in the firms earlier this year.
U.S. investment bank Goldman Sachs’ (GS) said in a May 12 note to clients that it sees several reasons to be bullish on Japanese stocks.
“We note the solid fundamentals compared with stocks on overseas markets, and we also think that expectations for structural changes/reforms could push Japanese equities up even further,” wrote Goldman Sachs.
