For the 41st month in a row, the Japanese Trade Balance is in deficit (around JPY1 trillion). Of course, the fact that exports fell 1.3% (but but devalued currency means competitive?) means nothing as all that really matters is the collapsing JPY (now at 108.60) at its weakest against the USD in 6 years. That can mean only one thing - a surging Japanese stock market - as the Nikkei breaks 16,000. What is odd - just as in the US - is the rising equity index (no doubt helped by Japanese pension funds buying JPY393billion in Q2) against a backdrop of plunging indivdidual stocks. Sony is limit down (as we explained earlier [6]) with offers outnumbering bids 8-to-1. And that's Japan...
41st month in a row of trade deficits... no J-Curve in sight
[7]
The JPY is collapsing...
[8]
Japanese stocks are surging...
- *JAPAN PENSION FUNDS BUY NET 393B YEN JPN STOCKS APRIL-JUNE QTR
[9]
But Sony is in utter freefall:
- *SONY YESTERDAY CLOSED AT 2,123 YEN IN TOKYO
- *SONY OFFERED LOWER AT 1,623 YEN IN TOKYO PRE-MARKET
- *SONY UNTRADED AT OPEN IN TOKYO, SET TO FALL
- *SONY SELL OFFERS OUTNUMBER BIDS 8 TO 1
- SONY FALLS AS MUCH AS 12% IN TOKYO, MOST SINCE NOV. 2013
And then there's this odd regime shift?
[10]
Charts: Bloomberg
