Goldman Sachs Group Inc. says most investors are betting Japanese stocks will outperform their Asian peers as a weaker yen and the prospect of policy stimulus in the wake of the March earthquake and tsunami boost confidence.
Investors see continued inflation and tight monetary policy conditions in Asia, especially in China and India, as a hindrance to the performance of the region's stocks relative to Japan, according to a survey of 77 investors during a conference this month in Tokyo, strategists led by Kathy Matsui wrote in a report Monday. Some 55 percent of survey respondents said they expect Japanese shares will beat equities in other Asian markets through the end of the year.
Political leadership in Japan has increasingly become a "crucial" factor for financial markets since the March 11 quake and tsunami that triggered the worst nuclear accident in 25 years. The MSCI Japan Index has plunged about 14 percent since March 10, while the MSCI Asia Pacific index excluding Japan has climbed 3.4 percent in the period.