Market is expected to reflect improving

Sumitomo Mitsui Asset Management
Japan Market Memo
For information only
(No.052)
Today’s
Topic
25 August 2016
Japanese equity market (August 2016)
Market is expected to reflect improving corporate earnings from this autumn
Point
1
Nikkei 225 index hovers around 16,000 level in August
Nikkei 225 index lags behind US equity market
 In August, global equity market as a whole,
is performing well epitomized by major
equity indices of the US market renewing
their record-highs. While, Nikkei 225 index
of Japan has been hovering around 16,000
level so far. Despite expectation of BOJ’s
ETF (Exchange-traded fund) purchase,
stronger JPY such as USD/JPY exchange rate
breaking through JPY100 level, weighed on
the Japanese equity market.
(JPY, USD)
22,000
"Nikkei 225 Index and Dow Jones Index"
20,000
Nikkei 225 Index (JPY)
18,000
16,000
Dow Jones Index (USD)
14,000
12,000
15/7
15/10
16/1
16/4
(Note) Data period is from 1st July 2015 to 22nd August 2016.
(Source) SMAM, based on Bloomberg. L.P.
Point
2
Earnings forecasts were
revised downward
Equity valuation is not high
16/7
(Year/Month)
"PER Forecast of Nikkei 225 Index"
(Times)
24
PER
22
Average + 1 STD
20
 Earnings forecasts announced by Japanese
corporations for FY2016 was revised
downward to a slight profit (recurring profit)
fall of – 1.9% YoY.
 On the other hand, price earnings ratio (PER
forecast, compiled by Bloomberg L. P.) of
Nikkei 225 index is still around its past
average. Japanese equity valuation measured
by PER is not at its expensive level.
Future Outlook
Average
18
16
14
Average - 1 STD
12
10
11
12
13
14
15
16
(Year)
(Note) 1. Data period is from 4th January 2011 to 22nd August 2016.
2. Price equity ratio (PER forecast) = Equity price / Earnings forecast, Nikkei 225 index base.
Bloomberg. L. P. forecast.
(Source) SMAM, based on Bloomberg. L. P.
Japanese equity market is expected to reflect improving corporate
earnings from this autumn
 Background of US equity market renewing its record-high is a solid recovery of the US economy with delay of
expected US rate hike. Furthermore, recent recovery of crude oil price is likely to become a tailwind to the
global equity market. Under such market environment, BOJ’s additional easing and implementation of front■当資料は、情報提供を目的として、三井住友アセットマネジメントが作成したものです。特定の投資信託、生命保険、株式、債券等の売買を推奨･勧誘す
loaded supplemental budget seem to support Japanese equity market. For the time being, growth of the
るものではありません。■当資料に基づいて取られた投資行動の結果については、当社は責任を負いません。■当資料の内容は作成基準日現在のもので
Japanese equity market might be limited under pressure of JPY appreciation, however, we expect its recovery
あり、将来予告なく変更されることがあります。■当資料に市場環境等についてのデータ・分析等が含まれる場合、それらは過去の実績及び将来の予想で
あり、今後の市場環境等を保証するものではありません。■当資料は当社が信頼性が高いと判断した情報等に基づき作成しておりますが、その正確性・完
from lag supported by i) US economic recovery and ii) improvement of corporate earnings due to a lull in
全性を保証するものではありません。■当資料にインデックス･統計資料等が記載される場合、それらの知的所有権その他の一切の権利は、その発行者お
stronger yen going forward.
よび許諾者に帰属します。■当資料に掲載されている写真がある場合、写真はイメージであり、本文とは関係ない場合があります。
Sumitomo Mitsui Asset Management
Japan Market Memo
(No.004)
For information only
25 September, 2014
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■当資料は、情報提供を目的として、三井住友アセットマネジメントが作成したものです。特定の投資信託、生命保険、株式、債券等の売買を推奨･勧誘す
るものではありません。■当資料に基づいて取られた投資行動の結果については、当社は責任を負いません。■当資料の内容は作成基準日現在のもので
あり、将来予告なく変更されることがあります。■当資料に市場環境等についてのデータ・分析等が含まれる場合、それらは過去の実績及び将来の予想で
あり、今後の市場環境等を保証するものではありません。■当資料は当社が信頼性が高いと判断した情報等に基づき作成しておりますが、その正確性・完
全性を保証するものではありません。■当資料にインデックス･統計資料等が記載される場合、それらの知的所有権その他の一切の権利は、その発行者お
よび許諾者に帰属します。■当資料に掲載されている写真がある場合、写真はイメージであり、本文とは関係ない場合があります。

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