Goldman Sachs Raises Japan TOPIX Forecast: "Will Rise to 2500 Within a Year"

Goldman Sachs has raised its forecast for the TOPIX index in Japan to 2500.

Photo by Yonhap News

According to Bloomberg on the 22nd, Goldman Sachs stated in a report released on the 21st that the TOPIX index could rise to 2500 within the next 12 months, raising its forecast from the previous 2200. This implies an upside potential of 8.9% compared to the closing price of the TOPIX index on that day (296.50).

Additionally, the 6-month target was raised from 2050 to 2400, and the 3-month estimate was increased from 2000 to 2200.

By sector, it recommended 'overweight' positions in technology sectors such as electrical machinery and information technology (IT) services, as well as value sectors like banks and automobiles. Conversely, it advised 'underweight' positions in sectors such as food, energy, construction, and pharmaceuticals.

The report stated, "We expect the Japanese stock market to undergo a correction in the summer and then rise again in the fall," adding, "The market will welcome positive outcomes such as upward revisions to guidance during the first half earnings season, strong earnings momentum, and announcements of additional measures to improve profitability." However, it noted the possibility of a slowdown in the short term due to signs of market overheating and a lack of positive catalysts.

It further added, "Although valuations have risen above historical averages due to recent stock price increases, structural changes and progress in corporate reforms will justify a premium in the price-to-earnings ratio (PER)."

This content was produced with the assistance of AI translation services.