Natixis boosts Japan equity allocation, anticipating continued growth
The asset manager, which oversees about $1.5 trillion globally, changed its weighting a day before Japan's 10-year government bond yield touched a century high of 3%.
Natixis Investment Managers has increased its allocation to Japanese equities, anticipating sustained economic growth, according to strategists Mabrouk Chetouane and Romain Aumond. They believe Japan's monetary and fiscal policies are more favorable for its economy and stock market compared to the United States, where Natixis has reduced its exposure.
Chetouane, head of global market strategy, stated that the forces driving Japan's stock market are stronger than those in the U.S., and there is no reason to maintain positive exposure in bond markets. The asset manager, managing around $1.5 trillion globally, adjusted its weighting on the same day Japan's 10-year government bond yield hit 3% for the first time this century.
Chetouane explained that higher inflation leads to improved corporate revenues and earnings, and the market has already factored this in. Natixis has kept "underexposure" to bond markets worldwide, as performance in longer-dated maturities has been negative. The firm sees the recent rise in real interest rates as a positive sign, driven by Japan's economic momentum.
Bank of Japan Governor Kazuo Ueda hinted at a potential rate hike, and overnight index swaps now price in a rate hike at the upcoming meeting. Natixis anticipates continued positive performance from Japanese stocks in 2026 and 2027, given strong economic indicators like wage growth.
Written by urgent.news from Japan Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
