2023-05-07 23:09:00
In the Japanese stock market on the 8th following Golden Week (GW), the movement of bank stocks is expected to attract attention. Japanese bank stocks have been seen as the most vulnerable in Asia to turmoil in the U.S. banking sector.
The KBW bank index fell 7.4% last week on fears of more US regional bank failures. However, the sharp rise on the 5th ended the week following recovering from the lows on a weekly basis. Japanese bank stocks were among the hardest hit in Asia during the March selloff following the collapse of Silicon Valley Bank (SVB). There was concern regarding interest rate risk due to the high holdings of US Treasuries.
“The main trigger is high interest rates. From that aspect, Japanese banks are the weakest in Asia,” said Michael McDudd, senior analyst at Morningstar. That includes local banks and other unlisted lenders, he explained.
The Bloomberg Asia-Pacific Bank Index rose 2.2% last week, even though Japanese markets were closed on March 3-5 for Golden Week. It showed a movement that went once morest the decline of the United States. Analysts have said since March the risk of a banking crisis spilling over to Asia has been limited overall, given capital buffers and weaker financial conditions than in the United States.
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