Japan's Mothers index outpaces rest of Asia on digitalisation bets
18/09/2020 11:50
By Eimi Yamamitsu
TOKYO, Sept 18 (Reuters) - Japan's Mothers index for
start-ups has emerged as the best-performing stock market in
Asia this year as individual investors bet on the shift to
remote work and digitalisation caused by the coronavirus crisis.
The Mothers board .MTHR , a Nasdaq-style market for small
start-ups listed on the Tokyo Stock Exchange, has soared 32%
since the start of the year to its highest in more than two
years.
Shenzhen's stock exchange index .SZSA is this year's
second-best performer, rising more than 28%, followed by Korea's
KOSPI index .KS11 with a 9.96% gain this year.
"This is fuelled almost exclusively by individual investors
betting on stocks that benefited from coronavirus lockdowns,"
said Yosuke Nakamura, a senior researcher at NLI Research
Institute. "Japan's new government also plans to place more
emphasis on IT and digitalisation."
The Mothers board comprises mostly small-cap software,
Internet services and biotech companies, favoured by many
Japanese retail investors.
There have been 32 initial public offerings so far this year
on the Mothers index, which has boosted investors' expectations
of a further rally in stocks.
Small cap stocks quickly bounced back from the coronavirus
shock, supported by "the presence of retail investors who favour
momentum trades", analysts at Okasan Securities said in an Aug.
24 report.
The best performing company on the Mothers index is
e-commerce platform BASE Inc 4477.T , up 510% this year.
Mercari Inc 4385.T , which runs a platform allowing users
to auction goods to each other, has the largest market
capitalization on the index at 743.6 billion yen ($7.13
billion). Its shares have climbed more than 116% so far this
year.
The Mothers index rose 0.51% on Friday.
($1 = 104.2600 yen)
(Reporting by Eimi Yamamitsu, Additional reporting by Stanley
White; Editing by Christian Schmollinger)
((eimi.yamamitsu@thomsonreuters.com;))