Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Stock Market SEASONAL TREND and ELECTION CYCLE - 24th Nov 20
Amazon Black Friday - Karcher K7 FC Pressure Washer Assembly and 1st Use - Is it Any Good? - 24th Nov 20
I Dislike Shallow People And Shallow Market Pullbacks - 24th Nov 20
Small Traders vs. Large Traders vs. Commercials: Who Is Right Most Often? - 24th Nov 20
10 Reasons You Should Trade With a Regulated Broker In UK - 24th Nov 20
Stock Market Elliott Wave Analysis - 23rd Nov 20
Evolution of the Fed - 23rd Nov 20
Gold and Silver Now and Then - A Comparison - 23rd Nov 20
Nasdaq NQ Has Stalled Above a 1.382 Fibonacci Expansion Range Three Times - 23rd Nov 20
Learn How To Trade Forex Successfully - 23rd Nov 20
Market 2020 vs 2016 and 2012 - 22nd Nov 20
Gold & Silver - Adapting Dynamic Learning Shows Possible Upside Price Rally - 22nd Nov 20
Stock Market Short-term Correction - 22nd Nov 20
Stock Market SPY/SPX Island Setups Warn Of A Potential Reversal In This Uptrend - 21st Nov 20
Why Budgies Make Great Pets for Kids - 21st Nov 20
How To Find The Best Dry Dog Food For Your Furry Best Friend?  - 21st Nov 20
The Key to a Successful LGBT Relationship is Matching by Preferences - 21st Nov 20
Stock Market Dow Long-term Trend Analysis - 20th Nov 20
Margin: How Stock Market Investors Are "Reaching for the Stars" - 20th Nov 20
World’s Largest Free-Trade Pact Inspiration for Global Economic Recovery - 20th Nov 20
Dating Sites Break all the Stereotypes About Distance - 20th Nov 20
THE STOCK MARKET BIG PICTURE - Video - 19th Nov 20
Reasons why Bitcoin is Treading at it's Highest Level Since 2017 and a Warning - 19th Nov 20
Media Celebrates after Trump’s Pro-Gold Fed Nominee Gets Blocked - 19th Nov 20
DJIA Short-term Stock Market Technical Trend Analysis - 19th Nov 20
Demoncracy Ushers in the Flu World Order How to Survive and Profit From What Is Coming - 19th Nov 20
US Bond Market: "When Investors Should Worry" - 18th Nov 20
Gold Remains the Best Pandemic Insurance - 18th Nov 20
GPU Fan Not Spinning FIX - How to Easily Extend the Life of Your Gaming PC System - 18th Nov 20
Dow Jones E-Mini Futures Tag 30k Twice – Setting Up Stock Market Double Top - 18th Nov 20
Edge Computing Is Leading the Next Great Tech Revolution - 18th Nov 20
This Chart Signals When Gold Stocks Will Explode - 17th Nov 20
Gold Price Momentous ally From 2000 Compared To SPY Stock Market and Nasdaq - 17th Nov 20
Creating Marketing Campaigns Using the Freedom of Information Act - 17th Nov 20
ILLEGITIMATE PRESIDENT - 17th Nov 20
Stock Market Uptrend in Process - 17th Nov 20
How My Friend Made $128,000 Investing in Stocks Without Knowing It - 16th Nov 20
Free-spending Biden and/or continued Fed stimulus will hike Gold prices - 16th Nov 20
Top Cheap Budgie Toys - Every Budgie Owner Should Have These Safe Bird Toys! - 16th Nov 20
Line Up For Your Jab to get your Covaids Freedom Pass and a 5% Work From Home Tax - 16th Nov 20
You May Have Overlooked These “Sleeper” Precious Metals - 16th Nov 20
Demystifying interesting facts about online Casinos - 16th Nov 20
What's Ahead for the Gold Market? - 15th Nov 20
Gold’s Momentous Rally From 2000 Compared To Stock Market SPY & QQQ - 15th Nov 20
Overclockers UK Quality of Custom Gaming System Build - OEM Windows Sticker? - 15th Nov 20
UK GCSE Exams 2021 CANCELLED! Grades Based on Mock Exams and Teacher Assessments - 15th Nov 20
Global "Debt Mountain": Beware of This "New Peak" - 13th Nov 20
Overclocking Zen 3 Ryzen 5600x, 5800x, 5900x and 5950x to 4.7ghz All Cores Cinebench R20 Scores - 13th Nov 20
Is Silver Leading Bitcoin or is Bitcoin Leading Silver? - 13th Nov 20
How Elliott Waves Simplify Your Technical Analysis - 13th Nov 20
How to buy Bitcoins using debit/credit card? - 13th Nov 20
Will COVID Vaccine Kill Gold and Silver? - 12th Nov 20
Access to Critical Market Reports - 12th Nov 20
Stock Market Dow Futures Reach 30,000 on News of COVID-19 Vaccine Trials Success - 12th Nov 20
8 Terms & Conditions You Must Know Before Asking For Life Insurance Policy Quotes - 12th Nov 20
Gold Stocks Post 2020 US Election Outlook - 11th Nov 20
Champions’ League Group Stage Draw: All You Need To Know - 11th Nov 20
Stock Market Secular Trend - 11th Nov 20
Stock Market Correction Curtailed by US Election - 11th Nov 20
What Causes a Financial Bubble? - 11th Nov 20
Ryzen 9 5900X RTX 3080 - Scan.co.uk vs Overclockers.co.uk UK Custom PC System Builder Review - 10th Nov 20
Killing Driveway Weeds FAST with a Pressure Washer - Saving Block Paving from LOTS of WEEDs - 10th Nov 20
Trump Fired, Biden Hired, What Next?  - 10th Nov 20
Looking for a Personal Loan? Here Is What You Have To Know  - 10th Nov 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

A Stealthy Stock Market You Shouldn't Ignore

Stock-Markets / Japanese Stock Market May 11, 2008 - 01:01 AM GMT

By: Yiannis_G_Mostrous

Stock-Markets Best Financial Markets Analysis ArticleAhead of the vote for Russian prime minister, Vladimir Putin set forth plans for a robust macroeconomic financial policy, reigniting the stock market to 2,280--a 3 percent gain--crossing the 2,200 mark for the first time since January as investor confidence swelled. Putin's primary goal: Reduce the tax burden on the oil sector to stimulate production and crude oil refining and lower inflation to single digits within the next few years.


Russia's fundamentally stronger economic potential and substantial financial reserves provide a robust foundation, which will help the country pass through this period of instability in the world economy. Russia can reap benefits from a number of opportunities, which are opening up now. This includes expansion of national capital abroad and domestic opportunities for boosting returns on investments of state financial reserves.

Putin was approved as prime minister by 392 out of 450 deputies who favored his candidacy.

I've been investing in Russia for quite some time now, and I still favor it as a valuable emerging market. I predicted in the beginning of the year that it would outperform well into 2008 and beyond. This recent spike is the beginning of a longer-term rally, and I expect profits to keep rolling in.

I've mentioned countless times that the Russian energy sector is undervalued. But with a new plan whose key priorities are developing the country's financial sector and cutting the oil tax burden, energy stocks will be revalued. The sector will benefit from Russia's tax-system changes and its outline for increasing its refining and gas business. (See my premium service The Silk Road Investor , 16 April 2008, A Bridge Across the Straits , for more.)

Earlier this week, Chip Hanlon--host of Market Neutral --invited me to give a podcast interview on the value of the Russian markets for Green Faucet . Visit www.greenfaucet.com/audio , and scroll down to Market Neutral: Russia to listen to my commentary.

The Rising Sun

The Japanese market is comfortably higher in the wake of The Economist's negative cover story on Japan two months ago. It looks as though the longer-term picture for the Japanese economy and stock market is much more positive than most investors perceive.

I previously noted the following regarding the British weekly's “Japain” analysis:

Although no one can be certain of the outcome, the British weekly is a contrarian indicator on many topics, and Japan is one of them.

When The Economist has mentioned Japan in the past, the market was ready to turn around, either to the upside or the downside, but always on the opposite direction of which the article had indicated. The usual time frame for the turnaround is between one and 18 weeks. Hopefully, the success of The Economist's forecasts will continue.

I've made the case for Japan's long-term potential on numerous occasions. The main idea is that the current economic cycle in Japan will be stronger and more enduring than most market observers anticipate. This view is based on the structural changes taking place in the Japanese economy (including changes in government financial institutions) and the eventual end of deflation.

On the latter point, the latest Consumer Price Index (CPI) numbers have turned slightly positive after a long time. This becomes even more important because they exclude food and energy.

Short-term market volatility aside, for long-term bulls on the nation's economy, Japan's confidence and its exit from deflation is all that matters. The normalization of rates increases the alternatives available for the Japanese so they can use their substantial bank deposits in more productive and profitable ways. Investors who don't think Japan's deflation years are over shouldn't own Japanese stocks.

Japan is still in a secular bull market that commenced in 2003, and despite its recent weakness, the Topix Index is building a good base around 1,200.

The majority of investors now have little interest in Japanese stocks, in stark contrast to the beginning of 2006. Investors then were influenced by the strong rally in the second half of 2005 and couldn't get enough of Japan.

The recent action is positive because it's relatively early; investors still have time to buy into this potentially very rewarding investment story.

Finally, the political situation in Japan remains murky, and former Prime Minister Junichiro Koizumi is greatly missed. The unwillingness of the current government to be more proactive with economic change will hurt Japan in the short term. It remains to be seen if Japanese authorities will be able to effectively navigate the economy back to normality (i.e., out of the deflation trap) and allow it to flourish once again.

On the other hand, if everything was politically harmonious in Japan, there would be no value opportunities.

On the global market front, markets continue to probe the proverbial wall of worry, seeking a way higher. It remains to be seen if this rally will stop soon or if we'll enjoy an explosive ride to the upside. I still expect more gains to come investors' way this year, although attention should be paid to the increased volatility.

When it comes to Asia, the big issue to which investors want answers is how to quantify the downside for Asian markets. Asia can drop 20 to 25 percent from current levels. This doesn't necessarily mean that it has to drop, but if things get ugly, this is how it should play out.

Any weakness in Asia--especially of that magnitude--will offer another opportunity to buy into this strong bull market.

By Yiannis G. Mostrous and Kate Zanoni
Editor: Silk Road Investor, Growth Engines
http://www.growthengines.com

Yiannis G. Mostrous is an associate editor of Personal Finance . He's editor of The Silk Road Investor , a financial advisory devoted to explaining the most profitable facets of emerging global economies, and Growth Engines , a free e-zine that provides regular updates on global markets. He's also an author of The Silk Road To Riches: How You Can Profit By Investing In Asia's Newfound Prosperity .

Yiannis_G_Mostrous Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules