Reported 9 months ago
The weakening yen has ceased to positively impact Japanese stocks, as the correlation between the Nikkei 225 Stock Average and the Japanese currency has turned negative due to concerns about the negative effects of the yen's decline on the economy. Fund managers are worried about potential market intervention to prevent further yen depreciation. This has led to net selling of shares by foreign investors, resulting in lower returns for dollar-based buyers compared to the S&P 500. The Bank of Japan's cautious approach and slow pace of rate hikes have exacerbated the situation, with sentiments deteriorating for consumers and smaller companies, despite the Nikkei's gains in yen terms.
Source: YAHOO