As the yen strengthens, a group of stocks, particularly importers, is attracting attention as yen-appreciation beneficiaries and moving alongside political and economic factors. The top picks and laggards include a wide range of specifically named stocks in furniture, apparel, food and general merchandise.
When the foreign exchange market moves toward a stronger yen, stocks whose profits are likely to improve as import costs fall tend to attract attention. The article discusses the view that episodes of yen appreciation may become more frequent, driven by expectations of coordinated Japan-US intervention and a narrowing of the Japan-US interest-rate differential.
Yen-appreciation beneficiaries span a broad range of sectors, including imported food, restaurants, imported furniture, general merchandise and ¥100 shops, imported vehicle sales, paper and pulp, and oil and coal. Representative examples include Kobe Bussan, Ishimitsu Shouji, Yamazaki Baking, Nippon Beet Sugar Manufacturing, Sapporo Holdings, Asahi Group Holdings, Nitori Holdings, Fast Retailing, ABC-Mart, Shimamura, Seria, Can Do, Watts, Amifa and Ryohin Keikaku.
The stocks specifically listed as top picks and laggards include Nitori Holdings, Kobe Bussan, Fast Retailing, ABC-Mart, Shimamura, Workman, Maruchiyo Yamaokaya, Lacto Japan, Seria, 2698 Can Do, 2735 Watts, 7800 Amifa, 2726 Pal Group Holdings and 7453 Ryohin Keikaku. Each is described as likely to benefit from yen appreciation.
The article concludes by encouraging investors to use a watchlist when considering yen-appreciation beneficiaries, and notes that a shift in the foreign exchange trend could mark a turning point for sector rotation.