[Present state recognition of fundamental]
In the US market last week, selling was
dominant as Fed reduced expectations for an early rate cut. In the medium to
long term, there are fears of a slowdown in the global economy due to confusion
of US politics, raise rate by FRB, European political turmoil and the
creditworthiness of European banks and credit crunch concerns, the economic slowdown
of emerging economies such as China, and concern over the global economic
slowdown due to trade war. We need continued attention to the geopolitical risk
of the Middle East , Korean Peninsula and Ukraine.
The difference in the yield spread between
the US and Japanese markets is 3.27 points less than in the Japanese market,
taking into account the 2020 OECD's real GDP forecast announced. The reason for
the bargain is due to the difference between S&P500 's PER of 17.7 and the
Nikkei average adopted stock price PER 11.9 and Japan-US interest rate
difference, GDP growth difference. This is because the difference in GDP growth
between Japan and the US in 2019 is 3.3% more than the OECD forecast (Japan
will downgrade or US will be revised upward) against the current Nikkei average
price, or it can be interpreted that the Japanese-U.S. Market will be in
equilibrium, because the expected PER of the Nikkei average hires will be
around 19.5 (the results for the current term will be revised downwards or the
Nikkei average will be around 34810 yen) . In the medium to long term, the
Japanese market is low valued at about 13540 yen.
[Conditions for Nikkei average rise]
In the future, the following assumptions
are necessary for the Nikkei average to rise further.
① Rising US market
② UP of expected profit increase rate for
the current term more than before
③ Expansion of the interest rate
differential between Japan and the US and further depreciation of the yen
④ Upward revision of Japan's 2020 GDP
estimate (now +0.68%) by OECD
⑤ Foreign investors over-buying
Looking at recent movements
① Last week's NYDow weekly foot was negative.
The daily bar is above the 200 day line, and it is above the cloud of the ichimoku
table. Nasdaq weekly foot was negative. NASDAQ bar is above the 200-day line and
it is above the cloud of the ichimoku table. This week we will be paying
attention to Housing related indicators, Quarterly financial results
announcement , June ISM Manufacturing Index, June Employment Statistics. I
would like to pay attention to whether NYDow can keep above the 25th day line.
② The expected profit increase for the
Nikkei 225 hires will be 8.9% with the announcement of the financial results
for the January-March term, 0.2 points worse than 3 months ago. In addition,
the profit growth rate for the current business forecast is +3.3%, an
improvement of 9.1 points from three months ago..
③Although long-term interest rates in the
United States fell, the interest rate differential between the United States
and Japan decreased from 2.22% to 2.18%, but the weak yen was in the range of
106 yen to 108 yen..
④ The OECD's real GDP growth rate in 2020
in Japan and the US is expected to be + 0.61% in Japan and + 2.28% in the US,
so the Japanese market is worse by 1.67 points on this aspect.
⑤ The 3rd week of June is a over selling. there is a high
possibility that the 4th week of June is
a over selling, and this week we are forecasting to over selling.
last week, ③ was a bullish factor but ① was a bearish
factor. It seems that ①,②,③,⑤ will be affected
this week.
[Technical viewpoint]
From the technical viewpoint of the
Japanese market, the 200-day divergence rate difference with NASDAQ is 8.6
points lower than NASDAQ in the medium to long term. (It is about 1830 yen when
it is based on the Nikkei average) Proportions shrank compared to last week.
The Nikkei average is under the cloud of
the ichimoku table. The total deviation rate was -1.2%, and shrank the negative
width compared to last week. The 200-day moving average line deviation rate was
-1.7%, and shrank the negative width compared to last week. Since the three
elements is negative, the "red signal" is lit in the medium term
trend. The Nikkei average is above the 25_day moving average line and the 9_day
moving average line, "green signal
" is lit for short-term trends.
In the US market NY Dow is above the 200_day
line and the 25_day line and the 9_day line. It is above the cloud of ichimoku
table. NASDAQ is above the 200_day average line and the 25_day average line and
the 9_day average line. It is above the cloud of the ichimoku table. In the
short term "green signal" is lit and in the medium term " green signal"
is lit.
[Outlook for this week]
Looking at the US market fundamentally,
concerns such as interest rate hikes in the United States, sluggish growth in
US corporate performance, financial market turmoil caused by credit slumps,
North Korea issues, falling crude oil prices and falling high yield bond
markets are receding However, global long-term interest rate decline trend,
US-China trade friction, US political uncertainty, lack of creditworthiness and
political situation of EU banks, global economic slowdown concern with trade
war, geopolitical risk of the Middle East and Ukraine Etc exist as a risk
factor.
Real estate prices in China are flat in
large cities, but the problems of nonperforming loans in China as a whole such
as excessive facilities have not been resolved. If you hurry up the process, it
will lead to a short-term market drop, and if you delay proceeding, there is
concern that the economic recession will be prolonged.
Also, the latest LIBOR interest rate is on
the upward trend, it continues to update the high price in the past five years,
which implies that global nonperforming debt continues to increase, and the
possibility of financial unrest is revealed .
On the other hand, the following points can
be pointed out as favorable materials. US interest rate cut expectations,
policy expectation of President Trump, setting of 2% inflation target by the
Bank of Japan, introduction of negative interest rate and purchase of ETF of 80
trillion yen · 6 trillion yen ETF Clarification of the duration of interest
rate manipulation and monetary easing and announcement of maintaining the level
of policy interest rates by the ECB during the year.
Looking at the technical aspect, the US
market is upward trend in the medium-term, and upward trend in the short term.
The Japanese market is downward trend in the medium-term, and upward trend in the
short term.
Analysis of the foreign exchange market
last week showed that the US long-term interest rates fell, and the US-Japan
long-term interest rate gap shrank, but the exchange rate was moving toward a weaker
yen in weeks. This week, 108 yen to 106 yen is expected. From now on, we need
to focus on technical indicators, US market trends, currency movements and
foreign investor trends.
