S&P and NDX are coming back to the main stage before 1Q numbers kick in. It seems to me that 1Q earnings(FY in Japan) will be stronger than consensus. The US major indexes are hitting record highs, whereas VIX is down to 16.
Stable 10-year yield and USD are supporting the bull market in the US. The strong message from Applied Material also giving momentum to Semis.
When it comes to Japan, JREIT is driving the market on the back of sustainable low yield and less supply in the office segment. Supply driven improvement in Office REIT. Not only Japanese banks but foreign investors are also buying JREIT as Japanese property is relatively cheaper.
Toshiba
DOME、PALTEK, Sanken, Invesco REIT, etc. TOB is becoming profitable in Japan, which didn't work in the past. The saga of Toshiba has a deep history of Nuclear plants and Earthquake in 2011. Accounting Fraud is a never-ending culture since 1996. Aggressive M&A, Goodwill and Impairment charges are hammering Toshiba for more than 15 years.
Employees on the frontline get heavy pressure to cover the losses from M&A. Anecdotally, they were told to generate $651mil operating profit against $624 mil sales in 2012.
Legend
Two guys stood in the firm's history. Mr Nishimuro and Mr Nishida. Both died without going to jail or confiscated their assets. Mr Nishimuro became CEO of TSE, Japan Post, Postal Bank, Counsellor of Keio Univ, and Honaraly Adviser of Toshiba.
[Nishimurro left , Nishida right]
Well, he's called a Title collector, Shadow Shogun or War Criminal. Nishimura was a chairman of the committee of the former president Abe, but no one showed up at his funeral.
Anyhow, the market doesn’t think CVC can make the TOB done. The share price finished lower on Friday. Nukes and Semis are reckoned as national security. But a person at METI says “it's unlikely for the government to stop the deal this time”.
[Fujimori, Seto, Kurumatani, Tsunakawa,]
Kurumatani(CEO), and Fujimori(director and CVC advisor) are expert of TOB. Mr Kurumatani was a former banker and made a deal with Nikko Sec. Fujimori worked at Sojitsu and GE before joining CVC. TOB is their speciality. It seems to me that they are well prepared to satisfy both government and activists with sweets. Mr Tsunakawa is a former CEO and a good negotiator to Activists. These are the main characters.
Toshiba is too big for governance. Dismantle the conglomerate might realize a higher value.
[Toshiba share price has been the same for a decade]
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