Investors are counting on solid earnings to help Japanese shares hold their gains in the final stretch of a volatile year that saw the market go from one of the world¡¯s top performers to the epicenter of a global meltdown.
While unlikely to revisit the record hit in July, the 225-issue Nikkei average may finish the year up 1.3% from its current level to 39,844, according to the average forecast of nine analysts surveyed by Bloomberg from Sept. 27 to Oct. 7. The broader Topix will tick up 2.1% to 2,797, the average estimate of seven analysts showed, bringing the annual increase to 19% for the Nikkei 225 and 18% for the Topix.
Analysts have been upgrading the Topix earnings outlook throughout this year, with forward looking earnings-per-share rising to about 188 points, as the yen¡¯s strength wanes and companies pass on higher input costs to consumers. Net profits at Japan¡¯s 500 biggest listed companies hit an all-time high of ?15 trillion ($101 billion) in the quarter ending in June.
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