Japan assets saw a tributary in April when investors left the US markets

In Japan in April, Japan noticed record tributaries of foreign shares and long -term bonds when investors escaped from US markets after the Presidential Salpo Donald Trump against friends and enemies.

Foreign investors According to government data, they bought 8.21 trillion ($ 56.6 billion) and long -term bonds. The pure influx has been the biggest for the calendar month since the Japanese Ministry of Finance started collecting data in 1996, Morningstar reports.

“Trump’s tariff shocks have probably changed the forecast of global investors to the US economy and asset results, which probably led to US diversification to other major markets, including Japan,” said Yujira Goth, FX Head of Japan Nomura.

Now that the US is mitigating its trading position and amazing deals, including China, confidence in US assets resumes. So, what does this Bode do for Japanese assets?

Most of the 8.21 trillion pure influx also occurred in the first week immediately after April 2, according to the ministry.

After the “mutual” tariffs in the opposite order, the 10-year Treasury of the United States increased by 30 basic points (from April 3 to April 9), while Japan’s 10-year revenue fell by 21 basic point (from April 2 to 8).

While stocks around the world have seen a sale immediately after tariffs on Trump, for the whole month, Japan Nikkei 225 grew more than 1%compared to S&P 500dropped slightly less than 1%.

Japanese assets are usually considered asylum, which grew as a “sale”, in April acquired a position, said Rashmi Garg, senior portfolio manager Al Dhabi Capital.

The influx is largely due to institutional investors rather than retail investors, said Goto Nomura. According to Nomura, retirement funds and other asset executives are likely to be aggressively bought shares, while Japanese bond purchases are largely due to the heads of reserves, life insurers, and pension funds.

“It was a pretty exceptional month when you consider everything that happened in the world macroeconomic conditions,” said Kay Okamura, SVP Neuberger Berman and Japanese shares.

“This obviously influenced how global investors thought about the distribution of assets against the United States … They needed to diversify,” he said CNBC in a phone call.

Garg al-Dhabi Capital expects the inflow to slow down, given the breakthrough in the US-Kita tariffs, as well as, as in other countries, probably. Britain is actually became the first country that ink conclusion from the US Last week.

While historical monthly tributaries may not continue, market observers still have a positive view of Japanese assets and continue to see strong tributaries.

Unprecedented Trump’s unprecedented actions and political flip flops have given the authority and confidence in their assets, and it can still cause global funds executives to put less in the US markets in favor of others, OCBC director explained.

“Given such a background, the demand for Japanese assets can remain healthy, even if it is not as strong as April,” he said. Manon said constant negotiations with the US also raised some optimism over 24% of the “return” tariffs for Japan.

Japanese shares will also benefit from the reforms of the Tokyo Stock Exchange Corporate Management, which has been prioritized by shareholders’ profitability, wrote the Asset Management One International.

TSE Corporate Management Reforms, which started in March 2023, a warrant in the list of companies that trade below value for the book to one to “perform or explain.

This reform program has led to a likely recording level in Japan, improving both stock and stock support, said Management One International.

While the dollar resumed a certain force after selling April, the potential for it will weaken further, and the Japanese currency to strengthen “makes sense” to look at Japanese shares, especially when the economy bounces, said Okomura Noberger Berman.

“So, this trend has legs. Japan will probably continue to see good flows,” Okomura said.

McDad Morningstar sees more pure tributaries in Japanese shares than in the last decade amid improvement corporate control.

Given this, it does not see the same influx of pure influx into short -term Japanese treasury bills, as if the Bank of Japan has implemented negative interest rates, since the possibility of arbitration for some foreign investors that existed is no longer present.