FundCalibre's Juliet Schooling Latter: Backing Japanese smaller companies for a comeback

Market 'marches to a different tune'

On the face of it, it should not be a particularly good moment for Japanese smaller companies.

The Japanese economy is stagnant and vulnerable to US tariffs. Interest rates are rising and the yen is strengthening. In any other country, it would be a tougher environment for its small-cap sector but the Japanese market marches to a different tune. The Japanese economy shrank 0.7% in the first quarter of the year. Its export-driven economy has proved vulnerable to the trade shocks created by US President Donald Trump's tariff regime, particularly its automobile sector. Exports fell, while private consumption was stagnant. The Japanese authorities face a tricky negotiation with...