Japanese Stock Market Surges Overcoming the 'Lost 30 Years'... Even 2030s Who Didn't Invest in Stocks Are Turning Their Attention

Young Generation Ignoring Stock Market, Seminar Activation
Attention on Whether It Can Resolve Shareholder Aging Issue

The Tokyo stock market in Japan surged to its highest level in 33 years since the bubble burst in 1990, sparking a stock boom among the younger generation who had previously ignored the domestic stock market. There is growing anticipation that this could bring about a generational shift in the Japanese stock market, which had long been concerned about the serious aging of shareholders.

[Image source=AP Yonhap News]

On the 29th, the Mainichi Shimbun reported on the recent stock boom phenomenon centered on Japan's younger generation. According to Financial Academy, a Japanese investment course provider, seminars teaching the basics of investing, such as how to read listed stock information and how to interpret the price-to-earnings ratio (PER), have recently seen a steady flow of attendees. The number of seminar applicants increased by 1.6 times between March and May. Most attendees are young people in their 20s to 40s, with a rising proportion of women.

The activity of individual investors also confirms this enthusiasm. SMBC Nikko Securities has seen a noticeable increase in inquiries such as "I cannot log into the trading system. Please tell me how to resolve this." Many investors who had created stock accounts but had not used them for a long time are now resuming trading due to the bullish Japanese stock market. In the case of SMBC Nikko, inquiries related to stock trading nearly doubled from April to this month, and online trading increased by 1.5 times.

The number of newly opened securities accounts has also increased significantly. According to Rakuten Securities, on the 17th of last month, when the Nikkei average price exceeded the 30,000 yen level for the first time in 1 year and 8 months, new account applications increased by 20% compared to the previous week during that week alone.

In Japan, attention is focused on whether the stock boom can revitalize the domestic stock market, which has been stagnant for 30 years. The biggest problem pointed out in the Japanese stock market is the aging of shareholders. In fact, in the case of Japanese telecommunications company NTT, more than 80% of shareholders are currently aged 60 or older. When it was listed in 1987, 700,000 people in their 30s and 40s bought the stock, and this generation has simply aged while holding onto their shares.

This has been cited as one of the causes of Japan's economic stagnation. Older shareholders tend to sell stocks before inheritance to purchase real estate, preventing wealth from being transferred to the younger generation. Coupled with the younger generation's reluctance to invest domestically, the Japanese stock market has essentially been stagnant with no capital flow. There is hope that the entry of people in their 20s to 40s into the market will resolve this stagnation.

Meanwhile, the stock boom is expected to continue for the time being, coinciding with the favorable trend in the Japanese stock market. Masahiro Ichikawa, chief market strategist at Mitsui Sumitomo DS Asset Management, analyzed, "Since buying by institutional investors such as pension funds is supporting the rise in stock prices, the upward trend is expected to continue for the time being."

He added, "It is necessary to pay attention to changes in the conditions supporting the stock price rise. If the Bank of Japan modifies its easing policy or if Japanese companies do not enhance their value, the direction of the stock boom could change at any time. In the long term, the key will be how much Japanese companies can increase their value to be recognized by investors."

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