Japan: Nomura's July Individual Investor Survey

The results of Nomura’s Individual Investor Survey [pdf] for July show sentiment worsened as the Nikkei tested calendar and multi-year highs. Investors appear to doubt how much upside is left in the near-term, while domestic politics become more of a concern.

Nomura closed its survey on June 22. At that point, the Nikkei 225 was trading near a calendar and seven year high.

The N225 set a new closing high this past Monday at 18,261.98, but traded slightly lower Tuesday and is facing selling pressure in morning trading Wednesday, last down around 18,050.

Nikkei 225 Stock Average chart as of Tuesday's (7/10) close:

Extracts from July's survey:

Most Appealing Sectors:

1. Materials (5th consecutive month)
2. Electrical Machinery & Precision Equipment (third last month)
3. Machinery, Shipbuilding & Heavy Machinery (not among "most/least-3" last month)

Least Appealing Sectors:

1. Electricity & Gas (ranked second [lowest] last month)
2. Financials (not among "most/least-3" last month)
3. Construction & Real Estate (ranked first [lowest] last month)

In its monthly feature question, Nomura asked what investors plan to do if they acquire foreign stock through triangular mergers. Nomura says based on respondents' answers, "We think the risk of "flowback" (the dumping of shares in a foreign company by shareholders immediately after acquisition) caused by individual investors is not that high." The most common answer was to judge holding/selling on share price outlook.

Most-watched Stocks (top-10):

1. Toyota (TM) (JP: 7203)
2. Sony (SNE) (JP: 6758)
3. Nippon Steel (JP: 5401)
4. Softbank (SFTBF.PK) (JP: 9984)
5. Canon (CAJ) (JP: 7751)
6. Tokyo Electric Power (JP: 9501)
7. Nintendo (NTDOY.PK) (JP: 7974)
8. Mitsubishi Heavy Industries (JP: 7011)
9. Oriental Land (JP: 4661)
10. Kagome (JP: 2811)

*ADR honorable mentions:
• Honda (HMC) (JP: 7267)
• Mizuho Fin. Grp. (MFG) (JP: 8411)
• Toshiba (TOSBF.PK) (JP: 6502)
• Nomura Hldgs (NMR) (JP: 8604)
• Sanyo Electric (SANYY.PK) (JP: 6764)
• Kyocera (KYO) (JP: 6971)
• Nissan Motor (NSANY) (JP: 7201)

Disclosure: The author does not own shares of any companies mentioned in this article.