In recent weeks we further raised our allocations to Japanese stocks, with near-term catalysts including: increased strength in bottom-up corporate earnings; evidence of ongoing corporate reform driving better shareholder returns; firm economic expectations; receding political risks, with Abe having secured a strong victory at the recent snap elections; and high operational leverage of Japan Inc to synchronous global economic improvements.
Looking further ahead, we see three key trends that we believe will be positive for Japanese equities in coming years…..
