Japanese stocks have trounced their Chinese peers this year, but some investors are betting the tide is about to turn.
Headwinds are growing for Japanese equities including deteriorating global growth and concern the era of yen weakness that has bolstered exporters’ earnings may be nearly over as the central bank comes under pressure to tighten policy.
Conversely, optimism is building that Beijing’s efforts to bolster the economy and local equity markets will help end a slump that has made Chinese equities among the world’s worst performers this year. Historically low valuations are also set to lure bottom fishers.
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