Japan's investors raise bets on Kono in leadership race
13/09/2021 06:14
* Investors see Kono having edge over rivals in LDP race
* Renewable energy, digitalisation shares gain on Kono hopes
* Medical service shares lose momentum after earlier gains
By Hideyuki Sano
TOKYO, Sept 13 (Reuters) - Japan's stock investors have
raised bets Taro Kono will become the country's next prime
minister, snatching up renewable energy and office technology
shares that are expected to benefit under his economic policies.
At the same time, investors are now trimming holdings of
some medical service shares that had previously benefited on now
fading expectations former foreign minister Fumio Kishida, an
advocate of spending in that sector, could succeed outgoing
Prime Minister Yoshihide Suga.
Weekend polls showed vaccine minister Kono emerging as a
strong favourite to become the next leader of the ruling Liberal
Democratic Party, and therefore prime minister, well ahead of
Kishida and former defence minister Shigeru Ishiba. urn:newsml:reuters.com:*:nL4N2QF02C
While there are few specific details about each candidate's
economic platforms, investors are nonetheless positioning
themselves ahead of the Sept. 29 LDP vote.
"Some foreign investors are buying Japanese stocks on Kono
hopes," said Hiroyuki Ueno, senior strategist at Sumitomo Mitsui
Trust Asset Management. "But his economic policies are still not
that clear, including his stance on the Bank of Japan's monetary
policy, so there is a risk markets may get disappointed."
Kono is known as a critic of nuclear power and investors
expect him to promote a further shift to renewable energy given
Japan last year adopted a carbon neutral goal. urn:newsml:reuters.com:*:nL1N2QC0Q6
His improved political prospects since the start of the
month have pushed renewable energy firm Renova 9519.T up 47%
over that period while rival West Holdings 1407.T has gained
26%, easily beating 6.5% gains in the broad Topix .TOPX index.
Similarly, Kono, as administrative reform minister, has
spearheaded efforts to abolish the use of "hanko" seals,
personal signature stamps traditionally used for managerial
approval and seen as a symbol of Japanese corporate
inefficiency.
His improved chances supported firms that provide document
digitalisation services. Bengo4.com 6027.T , which offers
electronic contract service, has risen 8.4% so far this month
while GMO GlobalSign 3788.T , a web certificate service firm,
added 9.7%.
Kishida's chances were undermined after former Prime
Minister Shinzo Abe, one of his main backers, switched his
support to lesser-known former home affair minister Sanae
Takaichi. urn:newsml:reuters.com:*:nL4N2Q702B
Kishida has pledged to expand the country's medical capacity
to deal with the COVID-19 outbreak so his candidacy and
initially strong support helped shares in that sector.
However, his subsequent loss of momentum has hit those
shares with Leoclan 7681.T , a medical equipment trading firm,
shedding some of its gains of more than 20%. MRT 6034.T , which
offers web-based staffing service for doctors and hospitals,
also lost steam.
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LDP leadership race and Japan stocks https://tmsnrt.rs/3A8cmvZ
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(Reporting by Hideyuki Sano and Noriyuki Hirata; Editing by Sam
Holmes)
((hideyuki.sano@thomsonreuters.com; +81 3 4520 1195;))