Yoshinori Shigemi, JP Morgan Asset Management
Global market strategist
Japan is expected to follow the US in introducing large scale stimulus packages, but the impact on the equity market may be limited.
This is because the Japanese economy has been dependent on external demand including foreign visitors, and domestic consumption is expected to be constrained due to stay-at-home order and lower future income expectation,
Compared with other markets, the Japanese stock market had already been cheap before the outbreak fallout, therefore it has not experienced a comparable plunge with the help of a stronger dollar weaker yen leaving it smaller room for recovery.
However, Japanese companies tend to have stronger balance sheet compared with peers in other equity markets.
I don’t think the delay of Tokyo 2020 Olympic and Paralympic Games brings a considerable shock and downside to the market, since it has already been priced in.