Kubota Masayuki (窪田 真之) of the Rakuten Securities Economic Research Institute forecasts that the Nikkei 225 will reach ¥100,000 in 2032 and ¥80,000 in 2029 as part of his long-term outlook for Japanese equities. EPS growth is expected to increase at an annual rate of 6.7%, driven by overseas business expansion, inflation, and share buybacks.
Four concerns have been identified as factors limiting the Nikkei 225's rise: a renewed Middle East crisis, concerns over inflation and higher interest rates in Japan and the US, renewed tariff concerns under the Trump administration, and concerns over excessive investment in AI and semiconductors. The view presented is that the summer lull will continue.
As a long-term forecast, the Nikkei 225 is expected to rise to ¥80,000 in 2029 and ¥100,000 in 2032. A chart and data comparing annual trends since 1973 with forward P/E ratios indicate that the current level is within a reasonable range.
The average EPS of companies on the Tokyo Stock Exchange's Prime Market is expected to increase at an annual rate of 6.7%, supporting the Nikkei 225's long-term rise. This growth is attributed to three factors: higher profits from overseas operations, entrenched inflation, and share buybacks.
The drivers of EPS growth are expected to include expanded overseas operations, improved earnings resulting from inflation, and annual share buybacks exceeding ¥15 trillion, all of which are expected to increase shareholder value and provide a foundation for long-term share price gains.