Tokyo-Japan stock investors have bet Taro Kono will become the country’s next prime minister by snagging renewable energy and office technology stocks, which are expected to benefit under his economic policies.
At the same time, investors are now diluting the holdings of some medical services stocks, which had previously benefited on lowering expectations, said former Foreign Minister Fumio Kishida, a spending advocate in that sector, succeeding outgoing Prime Minister Yoshihide Suga. can.
Polls over the weekend showed Vaccine Minister Kono is emerging as a strong favorite to become the next leader of the ruling Liberal Democratic Party, and therefore well ahead of the prime minister, Kishida, and former defense minister Shigeru Ishiba.
While there are some specific details about each candidate’s economic platform, investors are pushing themselves ahead of the September 29 LDP vote.
“Some foreign investors are buying Japanese shares on kono expectations,” said Hiroyuki Ueno, senior strategist at Sumitomo Mitsui Trust Asset Management. “But their economic policies are still unclear, including their stance on the Bank of Japan’s monetary policy, so riskier markets may be disappointed.”
Kono is known to be a critic of nuclear power and investors hope he will spur another shift to renewable energy, as Japan adopted a carbon neutral target last year.
His better political prospects since the start of the month have propelled renewable energy firm Renova up 47 percent in that period, while rival West Holdings has gained 26 percent, easily posting a 6.5 percent gain in the broader Topix index. have taken.
LDP leadership race and Japan’s shares
Similarly, as Minister of Administrative Reforms, Kono has led efforts to eliminate the use of “hanko” seals, personal signature stamps traditionally used for managerial approval and as a symbol of Japanese corporate incompetence. are seen in.
Their better opportunities favored firms that provide document digitization services. Electronic contract services provider Bengo4.com grew 8.4 percent so far this month, while web certificate services firm GMO GlobalSign added 9.7 percent.
Kishida’s prospects were downplayed after former Prime Minister Shinzo Abe, one of his main supporters, extended his support to lesser-known former Interior Minister Sane Takachi.
Kishida has promised to expand the country’s medical capacity to deal with the COVID-19 outbreak, so his candidacy and initially strong support helped stocks in that sector.
However, the loss of momentum that followed affected those stocks, with Lioklan, a medical device trading firm, losing more than 20 percent of some of its gains. MRT, which provides web-based staffing service for doctors and hospitals, also succumbed.
by Hideyuki Sano
This News Originally From – The Epoch Times