Japan: Nomura's April Individual Investor Survey

The results of Nomura’s Individual Investor Survey [pdf] for April show a worsening of sentiment for the first time in three months, although the responses seem to show an optimistic outlook for earnings and the domestic economy.

Nomura closed its survey on March 26. At that point the Nikkei 225 had rallied back some 800 points (about 5%) to 17,522, from recent lows hit in early and mid-March.

Over the next five sessions through April 2 however, it lost about 500 points (about 3%) -- but recouped most of the losses by the end of the first week of April and was basically unchanged from March 26. (See chart below)

The N225 is still about 800 points (4.5%) from its Feb. 26 multi-year high of 18,300.

Based on its current survey, Nomura says it thinks the global stock correction in late February "had a negative impact (on individual investor sentiment) but that it failed to lead to a major deterioration. ... a substantial decline (in its measure of individual investor sentiment) was avoided due to a large number of investors that continue to think that the domestic economy and corporate earnings are gradually recovering or continue to grow."

Extracts from April's survey:

Most Appealing Sectors:

1. Materials (ranked 1st last month)
2. Autos & Auto Parts (2nd)
3. Information & Telecommunications (replaced Pharma & Healthcare)

Least Appealing Sectors:

1. Electricity & gas (ranked 1st last month)
2. Financials
3. Resources (2nd, replaced Construction & Real Estate)

Most-watched Stocks (top-10):

1. Toyota (TM)
2. Nippon Steel (JP: 5401)
3. Softbank (SFTBF.PK)
4. Sony (SNE)
5. Canon (CAJ)
6. Tokyo Electric Power (JP: 9501)
7. All Nippon Airways (JP: 9202)
8. Mitsubishi UFJ FG (MTU)
9. Kagome (JP: 2811)
10. Toshiba (TOSBF.PK)
      Nintendo (NTDOY.PK)
      Mizuho Fin. Grp. (MFG)

*ADR honorable mentions:
• Sharp (SHCAY.PK)
• Honda (HMC)
• NTT DoCoMo (DCM)
• Matsushita (MC)

Disclosure: The author does not own any stocks mentioned in this article.