Visitors walk past Japan's Nikkei stock prices quotation board inside a conference hall in Tokyo, Japan September 14, 2022. REUTERS/Issei Kato/File PhotoHONG KONG : Japan's top-performing stocks are at risk of a sell-off because of overcrowded long positions in liquid and large companies, strategists from U.S. banks Morgan Stanley and JP Morgan say.
Japanese stocks have hit record highs this month, surpassing a previous peak in 1989, as investors bet on better growth and corporate governance. The year-long rally has continued even after the Bank of Japan exited a decades-long negative rates policy. Similarly, Morgan Stanley noted that large-cap Japanese stocks began to lose some steam in March, with the stocks tracked by the bank posting a moderate gain of 2.5 per cent this month compared to 6.2 per cent in February.