Encouraging signs as liquidity returns but outlook still uncertain

Predicting the direction of the Japanese stock market is becoming increasingly challenging - the Top...

Predicting the direction of the Japanese stock market is becoming increasingly challenging - the Topix has already risen nearly 30% since its recent trough in March, and for the moment opportunities to buy Japan's 'best companies' below the book value of their assets appear to have passed. On the positive side, the market overall is still trading at around book value - very close to 40-year lows - and this suggests Japanese equities remain cheap on a long-term basis. We are also seeing a gradual return of liquidity to lending markets, which is encouraging, but in the short term it is diffic...