Japan’s Government Pension Investment Fund plans to boost investment in growth stocks to increase returns and may eventually allocate several trillion yen to such equities, the Nikkei newspaper reported on Oct. 5.
Japan shares fell, with the Topix index capping the biggest two-day loss in two months, as exporters slumped on a stronger yen and Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. sparked banks’ biggest back-to-back retreat since May.
Japan’s biggest stock rally in a quarter century has been fueled by earnings growth that is three times faster than the world average, not just speculation Prime Minister Shinzo Abe will end two decades of deflation.
Eight months into the biggest equity rally in three decades, Japanese executives are gaining faith in the nation’s recovery as they reward shareholders with stock buybacks and pledge to increase capital spending.
The Tokyo Stock Exchange is looking to come up with new rules by the end of the year urging Japanese companies to respond to rumors and speculation in a concrete manner to address complaints from overseas investors.
The last time a dispute between Japan and China blew up in 2010 over eight uninhabited islands, the economic fallout lasted less than a month. This time, the spat is prolonging a recession in the world’s third-largest economy.