Japanese Stocks Getting Interesting - Yuma International.
Yuma International: The end of Federal Reserve QE makes Japanese stocks look particularly appealing.
Online, July 8, 2013 (Newswire.com) - In the wake of wild swings in the Japanese market, investors remain unsure whether so-called Abenomics will be successful and where the market is headed. But some international fund managers see a chance to pick up some interesting stocks on the correction.
A midweek market alert emailed to "Yuma International" clients has suggested that, in an environment where the Federal Reserve is no longer engaged in open-ended quantitative easing, Japanese stocks will begin to look particularly appealing.
Japanese stocks, which had enjoyed an ostensibly unstoppable bull run that began in November 2012, began a deep and protracted correction on May 23rd when foreign investors began to take risk off the table as concerns mounted over the Federal Reserve's intention to ease off its asset purchase program.
Other fund managers are also still underweight but sniffing around for opportunities as the Japanese government fires its three arrows of monetary policy, fiscal policy and structural reform.
"The seemingly inevitable cessation of the Fed's asset-purchasing program means that the Bank of Japan is now, by default, the world's most aggressive central bank," said the Yuma International email.
The email would seem to suggest the firm believes that, although currencies are weakened by QE, equity markets tend to be strengthened.
An Yuma International strategist confirmed, "It is our view that, in light of the recent sharp pullback in Japanese equities and expectations that the Bank of Japan will remain committed to its quantitative easing program, the short to medium term outlook for Japanese stocks is bullish. We are preparing recommendations that will position our clients to take advantage of the undeniable upside potential."