Latest news with #Japanes
Yahoo
29-05-2025
- Business
- Yahoo
Morgan Stanley Shares Rise 10.5% in a Month: Should You Buy the Stock?
Over the past month, shares of Morgan Stanley MS, a leading global investment bank, have risen 10.5%. The stock has outperformed the S&P 500 index, the Zacks Finance sector and the industry. Meanwhile, it has underperformed its close peer, Goldman Sachs GS, while outperforming JPMorgan JPM. Morgan Stanley's One-Month Price Performance Image Source: Zacks Investment Research However, lingering uncertainty around tariff policies continues to pose risks. Given this backdrop, let's assess whether Morgan Stanley stock is a lucrative bet or not. Entering 2025, a major rebound in mergers and acquisitions (M&As) was expected, with deal-making activities likely to grow in the mid-20s. This optimism stemmed from pent-up demand, stabilizing or declining interest rates, tightening credit spreads, and strong public market valuations. Also, the Trump administration was regarded as more business-friendly, with an expected rollback of stringent oversight that could mark the end of the prolonged regulatory of these has transpired till now. Deal-making activities have been muted as ambiguity over the tariff and ensuing trade war has resulted in extreme market volatility. These developments have led to economic uncertainty, data indicating a slowdown/recession in the U.S. economy, and rising inflationary pressure. Amid such a backdrop, companies are rethinking their M&A plans despite stabilizing rates and having significant investible Morgan Stanley management expects M&A and underwriting activities to pick up in the second half of 2025, impacting its M&A advisory fees in the near term. Further, the delay in M&A rebound will impact other IB firms, including JPMorgan and Goldman Sachs, which generate billions in revenues from M&A advisory fees. MS has lowered its reliance on capital markets for income generation. The company's focus on expanding its wealth and asset management operations and strategic acquisitions, including Eaton Vance, E*Trade Financial, and Shareworks, is a step in that direction. These moves have bolstered its diversification efforts, enhanced stability and created a more balanced revenue stream across market cycles. Both businesses' aggregate contribution to net revenues jumped to more than 55% in 2024 from 26% in 2010. For the first quarter of 2025, the aggregate contribution to net revenues was 50.3%.In the first quarter, Morgan Stanley witnessed net outflows of $13.6 billion in the Investment Management division because of volatile markets. On the other hand, assets under management or supervision grew 9.4% year over year to $1.6 trillion as of March 31, 2025. Further, the Wealth Management division's total client assets rose 9.5% on a year-over-year basis to $6 billion. Morgan Stanley's partnership with Mitsubishi UFJ Financial Group, Inc. MUFG is expected to continue supporting its financials. In 2023, the companies announced plans to deepen their 15-year alliance by merging certain operations within their Japanese brokerage joint new strategic alliance involves combined Japanese equity research, sales and execution services for institutional clients at Mitsubishi UFJ Morgan Stanley Securities and Morgan Stanley MUFG Securities. Also, their equity underwriting business has been rearranged between the two brokerage units. These efforts will solidify the company's position in the lucrative Japanese helped MS to achieve record equity net revenues in the first quarter of 2025, particularly in Asia, through outperformance in prime brokerage and derivatives driven by solid client activity amid heightened volatility. Further, the company's Asia region revenues jumped 34.5% year over year to $2.35 billion during the quarter. As of March 31, 2025, Morgan Stanley had a long-term debt of $297 billion, with only approximately $23 billion expected to mature over the next 12 months. The company's average liquidity resources were $351.7 billion as of the same date. Moreover, the company enjoys investment-grade long-term credit ratings of A1, A-, and A+ from Moody's, S&P Global Ratings, and Fitch Ratings, respectively, and a stable outlook allows easy access to the debt market. Thus, a solid balance sheet position supports its enhanced capital distributions. Following the 2024 stress test results, the company announced an increase in its quarterly dividend by 8.8% to 92.5 cents per company also reauthorized a new multi-year share repurchase program of up to $20 billion, effective the third quarter of 2024 and with no expiration date. As of March 31, 2025, approximately $17.5 billion worth of shares remained available under the authorization. Over the past month, the Zacks Consensus Estimate for 2025 earnings has been revised marginally downward to $8.58. Nonetheless, the consensus estimate for 2026 earnings has been revised marginally upward to $9.27. Estimate Revision Trend Image Source: Zacks Investment Research The Zacks Consensus Estimate for Morgan Stanley's 2025 and 2026 earnings implies year-over-year growth of 7.9% and 8.1%, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) The MS stock is currently trading at a forward 12-month price/earnings (P/E) of 14.39X. This is above the industry's 13.64X, reflecting a slightly stretched valuation. Price-to-Earnings F12M Image Source: Zacks Investment Research On the other hand, JPMorgan and Goldman Sachs have a forward P/E of 14.07X and 13.54X, respectively. This reflects that Morgan Stanley is expensive compared to its peers. Morgan Stanley's strong global presence and strategic focus on stable revenue streams provide a solid foundation for organic growth. Its diversified business model ensures resilience and growth potential, even in volatile market conditions. Resilient M&A pipelines and solid trading revenues are other the company has been witnessing a rise in expenses. Though expenses declined in 2022, the metric witnessed a five-year (ending 2024) CAGR of 7.8%. The rising trend continued in the first quarter of 2025. Expenses are likely to remain elevated given higher compensation costs, inflationary pressure and inorganic growth the likelihood of a significant IB rebound this year remains low amid concerns regarding tariff policies, making MS stock a cautious bet. Additionally, the stock's premium valuation and mixed analyst sentiment warrant careful consideration before shareholders may benefit from holding for strong long-term returns, while potential investors should wait for greater macroeconomic clarity before taking a Stanley currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report Morgan Stanley (MS) : Free Stock Analysis Report Mitsubishi UFJ Financial Group, Inc. (MUFG) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
24-05-2025
- Business
- Yahoo
There's a ‘buyer's strike' on U.S. assets as foreign investors can't stomach huge deficits anymore, analyst warns
Tepid demand for a 20-year bond auction sent Treasury yields spiking and the dollar tumbling this past week, amid mounting concerns over the federal government's ability to continue financing massive deficits as Congress looks to add trillions of dollars more in red ink. For Deutsche Bank's George Saravelos, they're signs of a 'buyer's strike' among foreign investors. Foreign investors are starting to shun U.S. assets as massive fiscal and current-account deficits are becoming too much to tolerate, according to George Saravelos, head of FX research at Deutsche Bank. In a recent note to investors, he commented on tepid demand for a 20-year bond auction this past week that sparked a selloff in Treasuries, sending yields higher. But that wasn't the worst thing about it. 'The most troubling part of the market reaction is that the dollar is weakening at the same time,' Saravelos wrote. 'To us this is a clear signal of a foreign buyer's strike on US assets and the associated US fiscal risks we have been warning for some time. At the core of the problem is that foreign investors are simply no longer willing to finance US twin deficits at current level of prices.' The jitters in the bond market also come as the U.S. House of Representatives passed legislation to extend tax cuts from President Donald Trump's first term as well as add new ones, like no taxes on tips and overtime. While lawmakers are also writing in some spending cuts, they are more than offset by reductions in tax revenue as well as increased outlays elsewhere, such as in defense. The net effect would be trillions of more dollars added to the budget deficits over the next decade. The Senate is expected to seek changes to the House's bill, but tax cuts are a top priority for Trump and congressional Republicans. Saravelos said there are only two ways to restore the attractiveness of U.S. assets to foreign investors. 'Either the US has to sharply revise the current reconciliation bill currently sitting in Congress to result in credibly tighter fiscal policy; or, the non-dollar value of US debt has to decline materially until it becomes cheap enough for foreign investors to return,' he wrote. Another headwind that U.S. assets face is bond market drama in Japan, which is facing a fiscal crisis of confidence and soaring yields too. The largest overseas holder of U.S. debt has its own mountain of debt just as its economy is beginning to shrink, with Prime Minister Shigeru Ishiba saying Japan's fiscal situation is 'worse than Greece's.' On Monday, yields on Japan's 40-year bond hit highs not seen in some 20 years. But for Saravelos, higher yields for Japanese government bonds aren't a reflection of fiscal concerns over the government in Tokyo. If that was the case, the yen would be selling off. Instead, the yen has rallied against the dollar, indicating less participation in the market for U.S. debt. 'We would argue the JGB sell-off is a bigger problem for the US treasury market: by making Japanese assets an attractive alternative for local investors, it encourages further divestment from the US,' Saravelos explained in a separate note this week. What Japanese investors do is critical to the bond market as the latest official U.S. data show that Japan's holdings of U.S. debt ticked higher to $1.13 trillion in March—roughly a quarter of its GDP. Meanwhile, China has been shedding its stockpile of Treasury bonds, which fell to $765 billion at the end of March from $784 billion in the previous month. That pushed China down the list as the third largest holder of U.S. Treasuries, with the U.K. overtaking it to become No. 2. 'At the core of our views in coming months is that the market is becoming increasingly driven by external asset positions, and this is putting combined downward pressure on US bond markets and the USD,' Saravelos said. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
RNZ News
03-05-2025
- Health
- RNZ News
East meets Aotearoa: NZ and Japan join forces on health innovation
Dr Jesse Whitehead, senior research fellow at Waikato's Te Ngira Institute for Population Research team, is spearheading a cross-cultural initiative between Japan and Aotearoa, designing and building resilient, equitable health systems. Photo: Supplied / Jesse Whitehead A health researcher spearheading a cross-cultural initiative between Japan and Aotearoa said both countries can learn from each other. A University of Waikato team is in the middle of a two-year project with Hiroshima University. Senior research fellow at Waikato's Te Ngira Institute for Population Research, Dr Jesse Whitehead, said the project's overall purpose was designing and building resilient equitable health systems. "We have three focuses, one is around improving equitable access to healthcare, climate resilience and being prepared for disasters, and demographic change by aging and immigration." Both countries had "similar risk profiles ... they are both on the ring of fire, and vulnerable to earthquakes, typhoons and tsunamis". In late 2024, the Waikato research team visited Japan for on-the-ground insights into healthcare delivery and emergency response. Whitehead said one standout lesson covered Japan's Disaster Medical Assistance Team (DMAT) system which mobilises doctors, nurses, and emergency responders directly to disaster sites rather than waiting for patients to reach hospitals - speeding up treatment and saving lives. "The level of preparedness is remarkable," Whitehead said. "Doctors and firefighters arrive on-scene together, enabling immediate triage and reducing preventable deaths. It's a system New Zealand can learn a lot from." The University of Waikato team is part of a two-year project with Hiroshima University, designing and building resilient, equitable health systems. Photo: Supplied / Jesse Whitehead Whitehead and his colleagues were also interested in the provincial scholarship system used to ensure a pipeline of doctors for rural areas. "Each prefecture or region offered two students a scholarship to cover all costs for their medical degree, in return for a commitment to working locally. It's an interesting model that works in their context." In a reciprocal exchange, researchers from Hiroshima University visited Waikato in early 2025 to explore New Zealand's approaches to healthcare. They were particularly interested in chronic pain management, the role of general practitioners, and the culturally grounded principles that guide care delivery. Each could learn from the other's population changes, he added. "Japan is now a super-aged society, with well over 21 percent of its population aged 65 and over - a milestone New Zealand is expected to hit by the early 2030s." Conversely, Japan could benefit from New Zealand's approach to immigration as a solution to its workload crises in the face of its ageing population. Whitehead said Japan was also one of few countries where doctors are trained in both Eastern and Western medicine, with traditional Japanese medicines playing a role in emergencies. "In the 2011 tsunami, the easiest thing for people to access was traditional medicine because they didn't need a prescription. It alleviates some of the immediate symptoms they were facing as well as stress, which is often the biggest health challenge people face after such an event." This had parallels with the potential of Rongoā Māori, the traditional Māori healing system, in Aotearoa, he added. Japan's rural communities used traditional hubs called Kouminkan, which were a place to meet and socialise. "New Zealand can be a bit disconnected so it would be great to get public resources for people to come together like that," Whitehead said. "However marae already play an important role in disaster response, as evacuation places, and Japan could learn from that." Whitehead said he was not sure if Japan's health system was "better per se, but it is different" compared to New Zealand's. It has a mandatory health scheme, similar to Britain's National Health Service, which means 80 percent of any medical or health costs are covered because they are funded directly from wages. "So they were quite shocked at some of our access issues we have here. "The first meeting I said, 'What are your waiting lists like in Japan?' They said, 'What's a waiting list?' "It's a totally different system. Having said that, their ageing population means there are probably future issues coming. How do you actually deliver those health services - and who pays for them?" Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Japan Times
31-03-2025
- Business
- Japan Times
In Tokyo, Pentagon chief provides assurances that Japan-U.S. alliance remains robust
The U.S. and Japan emphasized that security ties remain robust — despite rising concerns about the alliance's durability and looming tariffs under President Donald Trump — as the countries' defense chiefs held their first in-person talks Sunday in Tokyo. Saying that 'phase one' of a plan to upgrade the U.S. military's command in the country was underway, U.S. Secretary of Defense Pete Hegseth described Japan as an 'indispensable partner' in confronting China and sought to dispel lingering unease in Tokyo over Trump's penchant for a transactional approach when dealing with allies. "President Trump has also made it very clear, and we reiterate, we are going to put America first,' Hegseth said following his meeting with Defense Minister Gen Nakatani. 'But 'America First' does not mean America alone.' Trump and his picks for key administration posts have unnerved Tokyo with decisions to slap Japan with tariffs and comments that it should pay more for hosting U.S. troops while boosting its own defense spending. Asked if he had broached the issue of cost-sharing or defense spending with Nakatani, Hegseth said that while the two sides "did not talk specific numbers," he believed Japan would "make the correct determination of what capabilities are needed" — a hint that the Trump administration could ask Tokyo to instead purchase more U.S. weapons. "They have been a model ally and we have no doubt that will continue,' he said. 'But we also both recognize everybody needs to do more." Nakatani, for his part, said he had told Hegseth that military spending should be "implemented based on Japan's own judgment' and that 'what matters most is the content' of budgets, not the final figures. The Japanese defense chief also said he had 'gained the U.S. side's understanding' after explaining that Tokyo 'has continuously been working on a drastic strengthening' of its defense capabilities. While those issues could slow growing momentum for improved defense ties further down the road, Hegseth used Sunday's meeting to highlight a key unifying factor for the allies: their mutual desire to counter China's increasingly assertive military stance in the region. 'America and Japan stand firmly together in the face of aggressive and coercive actions by the communist Chinese,' Hegseth told a news conference following the talks. Defense Minister Gen Nakatani welcomes U.S. Secretary of Defense Pete Hegseth to the Defense Ministry in Tokyo on Sunday. | JIJI The U.S. 'is committed to sustaining robust, ready and credible deterrence in the Indo-Pacific, including across the Taiwan Strait,' he said, noting that Japan 'would be on the front lines of any contingency we might face in the western Pacific.' The Chinese military has been increasingly active near Japan in recent years — sometimes even entering territorial waters and airspace. Last year, a Chinese military plane entered Japanese airspace for the first time and one of the Asian powerhouse's navy survey ships entered Japanese territorial waters just days later. But Beijing's moves near self-ruled Taiwan — which China views as a renegade province that must be unified with the mainland, by force if necessary — has been one of Japan's top concerns. Tokyo has repeatedly said that any move on the island would also represent an existential crisis for Japan. The U.S. and Japan have found common cause in seeking to rein in China, a stance that has pushed forward long-sought shifts in defense policy in both Washington and Tokyo. One crucial change for the alliance will be the planned expansion of U.S. Forces Japan (USFJ). Last July, then-President Joe Biden announced a major revamp of the U.S. military command in Japan to deepen coordination with the Self-Defense Forces. Hegseth said that the Pentagon 'has started phase one' of upgrading USFJ 'to a joint force headquarters,' which he said would improve the U.S. military's ability to coordinate operations with Japan's own permanent Joint Operations Command, known colloquially as JJOC, which was established last week. Japanese defense officials said Nakatani briefed Hegseth on the new command, which will centrally oversee the SDF's three branches, allowing for the smoother integration of operations across domains to prepare for and respond to possible emergencies. The USFJ upgrade will eventually place a combined operational commander in Japan, who will be a counterpart of the JJOC head. For the time being, however, the JJOC counterpart will remain the head of the U.S. military's Indo-Pacific Command in Hawaii — more than 6,000 kilometers away. Hegseth's assurances over the upgrade came just days after U.S. and local media reports said the plan could be totally halted or watered down. Boosting the two countries' military presence in Japan's far-flung Nansei Islands and improving the militaries' responsiveness through 'more sophisticated and realistic bilateral training and exercises,' as well as deeper defense equipment and technical cooperation, were also discussed during the talks, according to Nakatani. The Japanese defense minister said that the two sides would boost the 'codevelopment, coproduction and co-sustainment' of defense equipment, with a focus on maintaining a stable supply of missiles. Under the allies' Defense Industrial Cooperation, Acquisition and Sustainment (DICAS) forum, a group created last year to identify areas for closer industrial cooperation, Nakatani said Japan would 'expedite efforts' to start coproduction of advanced medium-range air-to-air missiles (AMRAAM), while also conveying Tokyo's intention to pursue the possibility of coproducing SM-6 surface-to-air missiles. But the bright spots for the alliance that emerged from Sunday's meeting risk being overshadowed by Trump's announcement Wednesday that 25% tariffs on all automobile and auto part imports would be imposed from midnight on April 3. Japan is considering 'all possible options' in response, Prime Minister Shigeru Ishiba has said, but a refusal by the Trump administration to exempt Tokyo from this measure and other tariffs has pushed the top U.S. ally in Asia into crisis mode. Defense Minister Gen Nakatani (right) and U.S. Secretary of Defense Pete Hegseth review an honor guard during a welcome ceremony at the Defense Ministry in Tokyo ahead of their talks Sunday. | Pool / via AFP-JIJI The tough measures also come after Trump complained earlier this month that the U.S.-Japan security alliance was unfair. "I love Japan. We have a great relationship with Japan, but we have an interesting deal with Japan that we have to protect them, but they don't have to protect us," he said at the time. Japanese officials have disputed this characterization. Under the bilateral security treaty, more than 50,000 U.S. troops are based in Japan, which is also home to the U.S. Navy's 7th Fleet. The U.S. presence has grown increasingly important to Washington and Tokyo, analysts say, amid not only Chinese military assertiveness but North Korea's nuclear saber-rattling and Russian moves in the region. But turbulence could still hit the U.S.-Japan relationship going forward — despite Hegseth's pronouncements — as two key Trump administration nominees have taken aim at Japan's defense budget and its spending for American troops in the country. Elbridge Colby, Trump's nominee to be the Pentagon's top policy official, said earlier this month that Japan — which is aiming to spend 2% of gross domestic product on defense by fiscal 2027 — must boost its defense budget even further, to 'at least 3% of GDP on defense as soon as possible.' Meanwhile, Trump's pick to be the next ambassador to Japan, George Glass, said this month that he will "undoubtedly" need to press Japan to contribute more money for hosting U.S. troops, while also having 'tough conversations' about the allies' economic relationship. Sunday's defense talks came a day after Hegseth and Nakatani visited Ioto, the far-flung Japanese island known widely as Iwo Jima, for an event honoring those who died in bloody fighting there 80 years ago during World War II. Hegseth, who is on the final leg of his first trip to Asia as defense chief after stops in Hawaii, Guam and the Philippines, was also continuing to grapple with a growing scandal over leaked details about U.S. military strikes on Yemen earlier this month. The U.S. defense chief has been under fire for sharing the sensitive details over a commercial messaging app in which Trump's national security adviser mistakenly added a journalist to a group chat. On Friday, the Wall Street Journal reported that Hegseth had brought his wife, a former Fox News producer, to two meetings with foreign military counterparts where sensitive information was discussed, fueling more criticism of his fitness for the defense secretary post.
Japan Times
30-03-2025
- Automotive
- Japan Times
Japan considers all possible options as Trump threatens new auto tariffs
Japan is considering 'all possible options' in response to newly announced U.S. tariffs on auto and auto part imports, Prime Minister Shigeru Ishiba said Thursday. 'Various options are available, and we must assess which will be the most effective,' the prime minister said before an Upper House budget meeting. 'At this time, we are keeping all possibilities in mind.' Ishiba didn't directly answer a question on whether new tariffs would violate a 2019 trade agreement in which Japan lowered tariffs on American pork and beef products to avoid higher duties on autos exported to the United States. He didn't mention any possible concrete responses to protectionist measures implemented by the United States. At the meeting in parliament, Ishiba stressed Japan's investment record. 'We have made investments in the United States, created jobs and paid the highest wages. Japan's investment in the U.S. is among the highest — in fact, it ranks first,' Ishiba said. Given this, the government must ask 'whether it is truly appropriate to apply the same measures to all countries equally,' he added. Tokyo so far has failed on multiple occasions to persuade the administration of U.S. President Donald Trump to exempt Japan from new tariffs. 'The fact that these measures have been announced without excluding Japan is extremely regrettable,' Trade Minister Yoji Muto, who came back from Washington empty-handed earlier this month, told reporters on Thursday. The government will thoroughly examine the impact of new tariffs on industries and employment, and make sure necessary measures — such as financial support — are implemented, he added. Trade Minister Yoji Muto said Thursday that the new measures announced by Washington are regrettable. | Francis Tang Trump announced on Wednesday that 25% tariffs on all automobile and auto part imports would be imposed from midnight on April 3 , arguing that the imports 'threaten to impair' national security. 'What we're going to be doing is a 25% tariff for all cars that are not made in the United States,' the U.S. president told reporters in the Oval Office on Wednesday evening. Following Trump's announcement, Tokyo has made another request for exemption, Chief Cabinet Secretary Yoshimasa Hayashi said on Thursday. Vice Minister for Foreign Affairs Takehiro Funakoshi 'conveyed Japan's position' in a phone call with Deputy Secretary of State Christopher Landau in the early morning on the same day, according to the Foreign Ministry. Japan's auto exports to the United States were ¥6 trillion ($40 billion) in 2024, which is 28.3% of total exports to the country and the largest single category of exports to the United States, according to Finance Ministry data. Once the 25% tariff is implemented, Japan's domestic auto production would slump by 4.3%, according to a recent Japan Research Institute estimate . In Tokyo trading, automaker shares dropped on news of new auto tariffs, with Toyota falling as much as 4% on Thursday morning. Japanese carmakers are reportedly working to limit the damage of any new tariffs. Honda will produce its next Civic model in Indiana instead of Mexico, according to a Reuters report earlier this month.
