Attention is turning to small and mid-cap stocks less susceptible to the impact of US markets. With the FOMC and the Bank of Japan's policy meeting scheduled for next week, there is a view that risk aversion could intensify against a backdrop of higher crude oil prices and rising interest rates.
The Nikkei Average remained capped by its 13-week moving average and continued to trade below its 26-week moving average at times. Although tensions in the Middle East pushed WTI crude oil futures above the $100 level, prompting views that risk aversion could intensify, some believe the market should be watched for a rebound supported by the 26-week moving average.
The Federal Open Market Committee (FOMC) and the Bank of Japan's monetary policy meeting are scheduled for next week, and the probability of rate hikes is expected to come into focus depending on trends in the US employment data and price indexes. Even if the US and Japanese central banks raise interest rates simultaneously, the stock market could potentially experience a period of relief after the uncertainty has been priced in.
The focus this time is said to be on small and mid-cap stocks less susceptible to the impact of index trading, rather than stocks with a large impact on the indexes. Attention is turning to stocks considered to have relatively strong growth potential and stability.
The 5 stocks highlighted are TechMatrix, Nippon Chemi-Con, Kobe Bussan, Nihon Dengi and Techno Ryowa, which are presented as companies with distinctive strengths in their respective fields.