News & Insights

[External Link] Katsunori Ogawa, Chief Portfolio Manager for Sakigake High Alpha at SuMi TRUST AM, shared his views with WealthBriefing on the long-term outlook for AI investment, highlighting that infrastructure capacity, energy efficiency, and power management are likely to become increasingly important as AI adoption accelerates.

[External Link] Kei Fujimoto, Senior Economist at SuMi TRUST AM, shared his views with the media on the Bank of Japan's policy outlook, highlighting the potential for a faster pace of monetary tightening amid stronger economic growth and rising import-price inflation.

In July, Japanese equities delivered mixed performance as the TOPIX rose 0.2%, marking a fourth consecutive monthly gain and closing above 4,000 points for the first time, while the Nikkei 225 fell 8.1% amid a sharp sell-off in AI and semiconductor stocks. Concerns over excessive AI investment by US hyperscalers, intensifying competition from Chinese firms, and profit-taking following earlier gains weighed on sentiment, although buying in undervalued and cyclical sectors helped support the broader market.

In June, Japanese equities posted modest gains, with the TOPIX rising 0.9% and the Nikkei 225 advancing 5.6%, marking the TOPIX’s third consecutive month of gains. Markets briefly reached record highs following improving prospects for a US-Iran ceasefire agreement, but struggled to sustain momentum amid lingering geopolitical uncertainty, weakness in US semiconductor stocks and expectations of further Bank of Japan policy tightening.

In May, Japanese equities extended their strong upward momentum, supported by continued strength in AI and semiconductor-related stocks, solid corporate earnings and sustained foreign inflows, although geopolitical tensions continued to contribute to market volatility.