Great discussion from my pal Peter Boockvar of the Lindsey Group on Japan:
The Nikkei closed above 20,000 for the first time since April 2000. Optimism for corporate profitability, higher ROE’s, better corporate governance and a greater focus on satisfying shareholders, along with QE and a weak yen continues to drive performance that will likely continue.
Japan went back into a trade surplus in March for the first time since June ’12 as imports fell by 14.5% y/o/y vs the estimate of down 12.6%. Most of that decline was volume but a lower price of energy certainly was also a factor. Exports rose by 8.5%, in line with the estimate where volume growth was 3.3%, the best since March ’12. The Shanghai index continued its rip higher with another 2.4% gain and is currently in a classic case of an overbought market that stays overbought but is also turning parabolic.
At this point in the run, the H shares are dramatically more attractive than the A shares with A shares at a 29% premium vs the two year average of less than 4%.
His daily commentary is must read . . .
