Fidelity Japan Investors - FJV

Fidelity Japan Investors - FJV

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Stock Name Stock Symbol Market Stock Type
Fidelity Japan Trust Plc FJV London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
1.00 0.42% 241.00 14:13:13
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241.00 241.00 242.00 240.00
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snowydays: The bonus issue is only for subscription shares. They are a bit like warrants or options. They give you the right to buy ordinary shares at 86p until April 2016. Since this is above the current price there is no dilution and the subscription shares have little value. Small investors might even find that selling their bonus shares will not cover dealing costs.
cyborg27: Nice to see some interest again. I think everyone else has given up. I read an article about investors finally 'capitulating' regarding Japanese Smaller companies, which would be a good contrarian buy signal - it's got to change sometime! I think the new government has better ideas which will help.
knowing: Tokyo shares close sharply higher on Wall St rally, Nikkei above 14,000 - UPDATE TOKYO (Thomson Financial) - Japanese shares closed sharply higher on Friday after U.S. stocks rallied overnight on better-than-expected consumer spending and manufacturing data. The benchmark Nikkei finished above 14,000 points for the first time since February 27. Volume improved but still remained thin as some investors had retreated to the sidelines ahead of the release later in the day of the U.S. payrolls data for April and with Japan entering a long weekend. Japan's financial markets will be closed next Monday and Tuesday for the Golden Week public holidays. The Nikkei 225 Stock Average closed up 282.40 points or 2.1 percent at 14,049.26, off a high of 14,072.92. The index gained 1.3 percent for the week. The broader Topix index rose 31.29 points or 2.3 percent to 1,377.39, after rising to a high of 1,378.39. The Topix gained 2.8 percent over the week. "Amid a wait-and-see mode, investors were reluctant to take fresh positions when the Nikkei was trading at levels above 14,000 points," said Yumi Nishimura, manager for equity marketing at Daiwa Securities SMBC. "The outlook for the U.S. economy remained uncertain given little improvement in economic data," Nishimura said. "But if U.S. jobs turn out to be not so bad, stocks will likely rebound further with relatively weak selling pressure expected" in the 14,000-14,500 range. Gainers outpaced decliners 1,443 to 204, with 75 issues unchanged. Volume rose slightly to 1.72 billion shares from 1.7 billion shares on Thursday. Overnight, the U.S. Commerce Department said consumer spending rose a bigger-than-expected 0.4 percent in March, while the Institute for Supply Management said its U.S. manufacturing activity index for April stood at 48.6, slightly above market expectations of 48.0. The Dow rose 1.5 percent to 13,010.00, while the tech-heavy Nasdaq composite index climbed 2.8 percent to its highest close since January 10. Japanese stocks gained across the broad front, with financial and property sectors leading the rise. Big banks advanced as investors sought bargains after falls on Thursday. Mizuho Financial Group rallied 5.1 percent to 539,000 yen, Mitsubishi UFJ Financial climbed 2.7 percent to 1,131 yen and Sumitomo Mitsui Financial Group jumped 4 percent to 911,000 yen. General leasing firm Orix surged 7.3 percent to 19,900 yen. Top brokerage Nomura Holdings rose 4.2 percent to 1,835 yen. Nonlife insurance firm Millea Holdings surged 5.1 percent to 4,580 yen. Property counters also gained. Sumitomo Realty and Development rallied 7.4 percent to 2,690 yen following a report that the major developer will likely post a record pretax profit in the fiscal year to March 2008 for the eighth consecutive year. Other property developers were higher, with Mitsui Fudosan up 5 percent at 2,715 yen and Mitsubishi Estate up 4.5 percent at 2,995 yen. Semiconductor related issues gained. Stepper maker Nikon Corp. rose 3.3 percent to 3,100 yen. DRAM chipmaker, Elpida Memory rallied 6 percent to 3,880 yen. Japan's largest eyeglass maker HOYA jumped 5.4 percent at 3,010 yen. Sony Corp. was up 2.8 percent at 4,920 yen after the Nikkei newspaper reported that the consumer electronics giant will likely post group operating profit of around 380 billion yen ($3.6 billion) for the year ended March, up 430 percent from the previous year. Shares in Mitsui & Co. slipped 1.2 percent to 2,390 yen after the major trading house said it scored a record net profit of 410.1 billion ($3.9 billion) in the fiscal year ended March, up 36 percent from a year earlier. Profit was boosted by the strong performance of its energy-related operations amid rising crude oil and commodity prices. Its peer Mitsubishi Corp. was down 0.6 percent at 3,280 yen.
knowing: Japan year to July average commercial land price rises for 1st time in 16 years TOKYO (Thomson Financial) - The average price of commercial land in Japan rose 1.0 percent in the year to July 1, its first rise in 16 years and the strongest evidence yet that the world's second-largest economy is gradually escaping from years of deflation, the Land Ministry said Wednesday. According to the results of a survey conducted by the ministry, the average price of residential land in Japan slipped 0.7 percent during the period, falling for the 16th year, although the fall was smaller than the 2.3 percent decline a year earlier. The ministry's annual survey examines the prices of 24,374 properties based on appraisals by real estate valuers, every July 1. In the metropolitan areas of Tokyo, Osaka and Nagoya, average prices of both residential and commercial land increased for the second straight year. The average price of residential land rose 4.0 percent and the average price of commercial land increased 10.4 percent, the largest increase since 1990, when it rose 16.6 percent. Amid Japan's economic recovery, the rising trend of land prices in each metropolitan area continued to be supported by brisk demand for condominium units and offices as well as by a recovery in corporate profits. The uptrend in prices also spread to the surrounding areas. In metropolitan Tokyo, the average price of residential land increased 4.8 percent, rising for the second consecutive year. The average price of commercial land increased 12.1 percent, also rising for the second straight year and posting its biggest increase since 1988, when it rose 15.8 percent. In Tokyo's 23 central wards, the average price of residential land was up 13.1 percent from the previous year and the average price of commercial land was up 20 percent. In metropolitan Osaka, the average price of residential land rose 2.9 percent after being flat the year before. It was the first rise in 17 years. The average price of commercial land climbed 8.0 percent, rising for the second straight year. In metropolitan Nagoya, the average price of residential land price grew 2.4 percent, the first rise in 16 years, while the average price of commercial land rose 7.2 percent, up for the second straight year. But economists doubt there would be a repeat of the asset price bubble of the 1990s that later burst, leaving Japanese banks with saddled with huge debts. The annual survey showed that the downtrend in land prices in most of the rural areas remained. The average price of residential land in rural areas fell 2.3 percent, down for the 15th straight year, while the average price of commercial land dropped 2.6 percent, down for the 16th year. But in both cases, the declines were smaller than previously. "The mini-bubble in the major cities appears to be nearing its end due as massive redevelopment projects appear to have peaked," Societe Generale Asset Management senior economist Akio Yoshino said. "Because of lessons from past experience, Japanese financial institutions continue to show a conservative stance in extending loans related to asset investments, while investors have become more reasonable in weighing risks and returns, shifting funds quickly to other investment assets such as stocks, when the returns on asset-related products such as real estate investment trusts fall," said Daiwa Institute of Research senior economist Junichi Makino. "So, it is fair to think that land prices will continue to be reasonably priced going forward," he said. A much-awaited rebound in land prices appears to support the Bank of Japan's case for increasing interest rates from their present low levels, but economists are cautious about reading too much into the latest figures. "When signs begin to emerge that the rise in land prices may be moderating even in the major cities, the Bank of Japan could misjudge its policy call if it pegs monetary policy solely on land prices," Yoshino said. BoJ governor Toshihiko Fukui has said he is not worried about the possibility of another asset bubble. He said that while rising land prices in major cities such as Tokyo, Osaka and Nagoya look "somewhat rapid, they have not deviated notably" from fair value levels based on a discounted cash flow method. "It is difficult for us to base our monetary policy just on land prices or the foreign exchange market, but we will bear in mind these developments and make appropriate policy judgements," Fukui said.
knowing: Tokyo shares close sharply lower on US subprime, credit fears; firm yen TOKYO (Thomson Financial) - Japanese shares closed sharply lower on Thursday, as worsening anxiety over fallout from the subprime loans market in the US and tighter credit saw investors scrambling to exit equities in search of more safe haven investments. A stronger yen also weighed on exporters whose earnings typically benefit from a soft local currency. However the benchmark index managed to finish well off its intraday low as some intrepid bargain hunters stepped in late in the day to take advantage of the recent feverish selling. The blue-chip Nikkei 225 Stock Average finished down 327.12 points or 2.0 percent at 16,148.49, its lowest close since Nov 29 last year, but well off the intraday low of 15,859.46, its weakest mark since last Nov 28. By the close the Nikkei was almost 12 percent below its seven year high of 18,300.39 points, touched last Feb 26. The broader TOPIX index plunged 26.69 points, or 1.7 percent, to 1,567.46 after touching a low of 1,529.98. Decliners outnumbered gainers 1,469 to 206, with 206 issues unchanged. The volume of trade reached an estimated 2.68 billion shares, up from 2.03 billion Wednesday. Today's selling was triggered by another deep slide on Wall Street overnight, with the Dow Jones Industrial Average index shedding 1.3 percent to close below 13,000 points for the first time since April 24. A further liquidity injection into the money market by the Federal Reserve fail to calm investor fears of a looming credit crunch. In the forex market the yen was broadly stronger, dipping briefly below 116.0 to the dollar.
tonyr: GB904150, Atlantis Japan Growth (AJG) is worth consideration - a highly regarded manager, but consequently it rarely sells at much of a discount. Trustnet:- Prelims last week:- "The year to April 2007 saw lacklustre performance from the Japanese stock market, despite a relatively good economy and solid growth in corporate earnings. This was especially true in the case of smaller stocks and stocks outside of favoured areas such as manufacturing, commodities and export-related businesses. Nevertheless, at this time we remain encouraged by continued growth in the economy and corporate earnings, and by the benign trends on the consumer price front that have allowed Japan's central bank to limit interest rate hikes. We also remain confident that consumer spending will pick up momentum going forward, and will strongly underpin continued growth in the economy in the months and years ahead. As long-time investors in Japan well know, consumer spending has been under pressure since the early 1990s as a result of a prolonged period of deflation. The extended drop in asset prices not only reduced the store of wealth of households, through pulling down real estate and stock market prices, it also led to heightened anxiety on the income front, as corporations were forced to restructure, putting more into unemployment and capping income gains for those remaining in work. Only recently have we started to see the light at the end of the tunnel for the Japanese consumer. The prolonged downtrend in asset prices finally appears to be coming to an end, with property prices in major cities now stabilising or moving higher, and stock market prices well above their lows recorded in 2003. Households are also starting to see improvements on the income side, as consecutive years of earnings growth has put corporations in a position to increase the hiring of full-time employees and increase wages, overtime hours and bonuses for existing employees. To be sure, these favourable turns have not yet been enough to bring about a full-fledged recovery in consumer spending. However, we believe these supportive trends will lead to higher consumer spending going forward, which will in turn bolster overall growth and confidence in the economy. In the stock market, we note that local retail investors currently account for about 40-50% of daily trading volume. On balance, Japanese retail investors were net sellers again during the past year, as they have been for many years. Even so, we are finding signs of a growing interest in equity investments, a reflection of a slow, but steady recovery in investor confidence following recent years of sustained growth in corporate earnings and ongoing increases in stock dividend payouts. In addition to net buying by local investment trusts, which represent buying by retail investors, we also find domestic institutional investors such as pension funds showing a greater inclination towards increased exposure to domestic equities, including smaller stocks. The Company remains heavily weighted in small and medium-sized stocks, reflecting our adviser Ed Merner's view that most of the best investment opportunities are still found in this area of the market. These smaller companies, some of which are listed on the newer markets or regional stock exchanges, are seen as offering good value for long-term investors. In many cases, the holdings in which the Company has invested are insulated from swings in the overall economy because they operate in fast growing niche businesses such as generic drugs, temporary worker dispatch services, internet advertising, software and IT services. Regardless of trends in individual company fundamentals, however, there are times when small cap stocks will move sideways or down even as large cap issues continue to rise, and this is precisely what has happened during the past year. This short-term setback notwithstanding, we remain confident that most of the companies in which the Company has invested will continue to grow as expected and, thus, will turn out to reward long-term investors. During the past year, while many major world stock markets moved to new highs, the Japanese market was left behind. With Japanese corporate earnings continuing to rise during this timeframe, share price valuations in Japan have thus remained at their lowest levels since the mid- to early-1980s. Based on prospects for continued growth in the domestic economy and corporate earnings coupled with near-zero inflation, we believe the stage is set for the Japanese stock market to begin moving higher once again and, in particular, think the Company is well positioned to benefit from the recovery." - there's obviously a good possibility that Japan remains a lagard and money tied up in any of these Japanese focused funds continues to languish. But, after the falling/sideways movement since the start of 2006 on the Topix 2nd section, a positive change in sentiment could quickly see some sizeable gains: just a return to the end of 2005 levels, never mind a catch-up with emerging Asian markets, would deliver considerable upside from here, especially if combined with reduction in discounts to NAV (or back to a significant premium in the case of AJG). The sensible thing to do would probably be to wait for some indication that this change in sentiment was underway: less upside, but also reducing the chance of money tied up languishing.
knowing: Tokyo shares end morning narrowly mixed; Tankan fails to provide lead - UPDATE TOKYO (Thomson Financial) - Share prices ended the morning session little changed, after the Bank of Japan's June quarter Tankan survey came in as expected, showing little real change in business sentiment among big manufacturers from March. The blue-chip Nikkei 225 Stock Average ended the morning session down 17.74 points, or 0.10 pct, at 18,120.62, off a low of 18,062.49 and a high of 18,139.04. The broader-covering TOPIX index was up 2.50 points, or 0.14 pct, at 1,777.38, off a low of 1,770.30 and a high of 1,777.60. Gainers beat decliners 910 to 654 on the Tokyo Stock Exchange's first section, with 161 issues flat. An estimated 863 mln shares changed hands, up from 824 mln Friday morning. Business confidence among Japan's large manufacturers was steady in the second quarter, after a decline in the first, according to the results of the Tankan survey released just before the opening bell. The diffusion index of sentiment among large manufacturers was plus 23 last month, unchanged from March. Economists had forecast, on average, that this index would come in at plus 23. The large non-manufacturers' diffusion index came in at plus 22, in line with the average forecast. The absence of fresh trading incentives prompted some investors to lock in gains after prices had risen late last week on window dressing activity by foreign investors seeking to spruce up their portfolios ahead of the end of the first half of the year. "Profit-taking was inevitable following the technical rises Friday. With all the key scheduled events (data, the Tankan) since late last week now out of the way, the Nikkei is likely to trend higher this week, possibly testing 18,400-18,500 points," said Hiroichi Nishi, an equities information manager at Nikko Cordial Securities. Some bargain hunting was seen on dips as investors generally expect the weak yen to help exporters achieve better-than-forecast earnings in the current fiscal to March 2008. Among losers in the limelight, shares of Japan's largest department store operators, Takashimaya and Mitsukoshi, both fell after they separately reported year-on-year declines in fiscal first quarter to May earnings. Takashimaya slumped 27 yen or 1.74 pct to 1,529 while Mitsukoshi dropped 9 yen or 1.46 pct to 608. Among counters in the news, Isuzu Motors rose 22 yen or 3.29 pct to 690, with Hino Motors up 9 yen or 1.22 pct at 746, on the back of a Nikkei business daily report that the two truckmakers will jointly develop technology for cleaning up emissions from diesel engines. The move is designed to enable them to compete more effectively against European and U.S. rivals, the report said. Toyota Motor which has stakes in the two truckmakers ended the session flat at 7,880. Asahi Breweries slipped 14 yen or 0.73 pct to 1,897 on the back of a report that the brewer may post current profit of 27 bln yen in the first half to June 30, down
knowing: Tokyo shares seen retesting 7-year high as first-half gains may extend TOKYO (Thomson Financial) - The Tokyo stock market is expected to extend its first-half gains into the second half, propelling the benchmark Nikkei 225 index toward 20,000, its highest level in seven years and more than 10 percent above the close on Friday. In a continuation of trends seen in the first half, the industrialization of the so-called BRIC countries -- Brazil, Russia, India and China -- and a firm economic outlook in other parts of the world are expected to encourage investors to buy shares of exporters, while concerns about the strength of domestic demand remain, analysts said. In the first half, Hitachi Zosen, Japan Steel Works and Sumitomo Metal Mining enjoyed the biggest percentage gains among Nikkei components as investors eyed growing demand in the BRIC countries and greater Asia for industrial materials and cargo transportation. Those gains helped power the blue-chip market gauge to a 5.3 pct gain to 18,138.36 on Friday from 17,225.83 on December 29, its last trading day in 2006. Not all stocks took part in the rally. Shinsei Bank, Casio Computer and Sky Perfect JSAT suffered the steepest percentage declines, hit by earnings worries. The Nikkei touched a seven-year closing high of 18,240.30 on June 21, after overcoming the global stock market turmoil triggered by a sharp sell-off in the Chinese market in late February. The steep decline on the Shanghai stock exchange caused the Nikkei to shed its year-to-date gains and sent it to a March 5 closing low of 16,642.25, a full 8.6 pct below the February 26 close of 18,215.35. For the rest of the year, the Nikkei is likely to advance further into territory not seen since mid-2000, as the benefits of a weaker yen are felt, boosting investor confidence in the export-oriented Japanese economy, analysts said. "The market will probably trend higher to a little above or below 20,000 on the Nikkei by the year-end. This is based strictly on the condition that the yen stays near current levels and thereby leads to the upgrading of earnings projections by major exporters," said Hiroyuki Fukunaga, strategist at Rakuten Securities. The dollar has climbed to just below 124 yen in recent sessions, up almost eight yen from its March level with half of the four-month gain coming after Japanese companies had hammered out earnings projections that were based on an outlook for a firmer yen. By sector, producers of steel and other industrial materials, as well as shipping companies and shipbuilders, are expected to remain investor favorites in light of strong demand from BRIC countries and broader Asia. "Steel makers and marine transporters are best placed to benefit from surging demand in such emerging countries as China. Nippon Steel and Mitsui OSK Lines, the leaders of these sectors, are a must to have in portfolios," said one trader at a European asset management firm. Nippon Steel has forecast that its revenues would expand 11 pct to 4.76 trln yen in the current fiscal year. Mitsui OSK has forecast an 8 pct rise in revenues to 1.70 trln yen in the year to March 2008. Shares of carmakers, such as Toyota Motor, may also gain in popularity as the yen weakens, raising hopes that these companies that are heavily dependent on offshore demand may beat the earnings projections made in April and May, analysts said. A weak yen buoys the yen-converted value of earnings received in foreign currencies. Shares of high tech companies, on the other hand, may not enjoy as much investor interest despite their deep ties to demand abroad, as they are faced with stiffer competition from players in not only the US and Europe but also Asia, analysts said. Bridgestone, the world's largest tire maker, on Wednesday lifted its earnings guidance for the year to December, attributing its improved outlook to the weaker-than-expected yen so far this year, as well as surprisingly firm sales in the US. Analysts said Bridgestone's announcement is the first sign of the impact the weak yen is having and bodes well for all the carmakers, the major constituents of the Nikkei index. "There is a possibility that the yen's recent weakness may lift earnings sharply" at carmakers, while their business fundamentals have also improved, thanks partly to the increasing weight of China and other emerging markets, said Shinya Naruse, a car-sector analyst at Nomura Securities. Rising gasoline prices have made fuel-efficient cars popular, and this should also help Japanese carmakers escape much of the impact of softer demand in the US where top Japanese carmakers generate roughly 60 pct of their operating profits, he said. The Nomura analyst on Wednesday lifted his investment recommendation on the auto sector to bullish from neutral, and said car shares are broadly undervalued at current levels. But although most analysts are bullish on the stock market, they caution that political uncertainty may pressure the Nikkei towards 17,500 or slightly lower before the upper house election on July 29. "The election, along with a probable rate hike by the Bank of Japan, is the most significant event when looking at the market's prospects through the year-end," said the trader at the European asset manager. Investors are wary that the vote may sap Prime Minister Shinzo Abe's ruling Liberal Democratic Party and drag on the government's efforts to reform the Japanese economy. Reforms have been a key market driver in recent years. The Nikkei began its advance in October 2005 when the Parliament passed a bill to privatize the postal services, a plan proposed by Abe's predecessor, the reformist prime minister Junichiro Koizumi. At that time, the Nikkei was trading around 13,000. "If a loss by the LDP in the vote removes foreign investors' hopes in Japan's chances to reform, they may unload the holdings built in positive response to the passing of the postal services reform bill. That would be a major pressure on the market," Rakuten's Fukunaga said. The lack of a steady recovery in consumer demand may continue to be a source of concerns for investors as it has been for the Bank of Japan which aims to "normalize" its super low interest rates. Even so, investors expect the central bank to raise its overnight call rate target by 25 basis points to 0.75 pct after the election, most likely in August. "Share prices have factored in the possibility of one rate hike this year, while uncertainties remain on chances of a second move," said Tsuyoshi Segawa, strategist at Shinko Securities. Investors will monitor closely the effects of one or two rate hikes on the economy and on the yen, analysts said. The best timing to launch into buying will be around September if a possible August rate hike fails to spark the active unwinding of yen carry trades, which would cause the yen to strengthen again. "An upgrading of earnings projections by carmakers and other exporters in or around September will trigger the buying spree which I expect to send the Nikkei rising towards its highs for the year," Rakuten's Fukunaga said. (1 usd = 123.21 yen)
knowing: Tokyo shares close firmer after worry about global sell-off eases - UPDATE (Adds analyst comment, notable share prices) TOKYO (XFN-ASIA) - Share prices closed sharply higher after Wall Street's gains overnight eased concern that the slump in Chinese markets yesterday would spark a global rout like that in February, dealers said. The Nikkei 225 Stock Average closed 287.49 points or 1.63 pct higher at the day's peak of 17,875.75, its highest closing level since Feb 27, when it settled at 18,119.92. The TOPIX index of all first-section issues advanced 21.93 points or 1.26 pct to 1,755.68, off a high of 1,757.09. Gainers overwhelmed decliners 1,286 to 324, with 118 issues flat. Volume was 2.16 bln shares, down from 2.02 bln yesterday. Mitsushige Akino, chief fund manager at Ichiyoshi Management, said: "The market welcomed the US stock markets' gains overnight, easing worries that sharp losses in Chinese markets yesterday might lead a global sell-off." Akino said markets could avoid another global meltdown in stocks because they had learned from what had happened in February. "As Chinese stock markets are booming, it is no surprise if China's share prices show a certain level of volatility. And the volatility does not necessarily reflect China's real economy," he said. Investors will pay attention to important data about the US economy that are due to be released soon, including the real GDP figure for the first quarter, due later today, and the employment report for this month, due Friday, dealers said. "Since economic conditions are solid in the US, strong economic data would increase the risk of a rate increase, which would be a blow for stock markets. So a situation in which economic conditions remain resilient with the possibility of a rate cut would be favorable for stock markets," he said. Ryuta Otsuka, a strategist at Tokyo Securities, said: "Investors may shrug it off if the US real GDP is weaker than expected, because these data are about the past, while investors are more interested in economic growth in the April-June quarter." Stocks were broadly higher. In the real estate sector, Mitsui Fudosan was up 130 yen or 3.5 pct at 3,830, Mitsubishi Estate rose 110 yen or 3 pct to 3,740 and Sumitomo Realty & Development gained 130 yen or 2.9 pct at 4,600. Stocks of shipping lines were also higher. Nippon Yusen was up 27 yen or 2.5 pct at 1,123, Mitsui OSK Lines climbed 63 yen or 3.9 pct to 1,668 and Kawasaki Kisen rose 31 yen or 2.1 pct to 1,475. Shin-Etsu Chemical rose 250 yen or 3.2 pct to 8,160, Sumitomo Chemical was 15 yen or 1.9 pct higher at 806 and Mitsubishi Chemical Holdings gained 38 yen or 3.7 pct at 1,065.
isa23: Deutsche Bank's Musha Calls Japanese Stocks `A Major Bargain' By Patrick Rial May 23 (Bloomberg) -- Investors should snap up Japanese shares because they are inexpensive by four different measures, according to Ryoji Musha, chief investment officer at the Japanese brokerage unit of Deutsche Bank AG. ``Right now the Japanese market is a major bargain,'' Musha said, speaking at a conference in Tokyo hosted by Deutsche Bank. ``In terms of stock prices, interest rates, the weak yen and the cost of goods, it's cheap.'' Last week, shares in Japan reached the lowest level in six months relative to the price of U.S. stocks, according to a report released yesterday by JPMorgan Securities Japan Co. Long term interest rates have been on a gradual decline for years, even as central banks such as the U.S. Federal Reserve conducted a two-year drive to tighten credit, Musha said, recalling former Fed chairman Alan Greenspan has called the lack of a market response to monetary policy a ``conundrum.'' While the gap between intended monetary policy effects and actual interest rates would normally be a warning sign for investors, this time it isn't, Musha, 57, said. Rates should remain low as companies continue to earn more money than they spend on investments, relieving pressure on borrowing costs, he said. ``Looking at the excessive savings of corporations worldwide, it seems declining interest rates is a logical trend and one that is sustainable,'' Musha said. The yen has weakened 2.2 percent against the dollar so far this year and has fallen to a record low against the euro 17 times in 2007. A weaker yen makes Japanese shares cheaper for foreign investors and increases the value of companies' dollar- denominated sales when converted back into local currency. Costs Under Control Japanese companies are also benefiting from a lack of inflation that is helping to keep input prices down. Japan's core consumer prices, which exclude fresh food, didn't increase on a year-over-year basis during the first three months of this year. The April figure, which will be released on May 25, is expected to show a 0.1 percent drop, according to economists surveyed by Bloomberg. Musha began covering Japanese stocks as an analyst in Daiwa Securities Co.'s research division in Tokyo in 1973. He was a global strategist at Daiwa's New York branch from 1988 to 1993. He joined the Tokyo unit of Deutsche Bank in January 1997 and was ranked the top Japanese equity strategist by Institutional Investor in 2002. To contact the reporter for
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