Schroder Japan Share News (SJG)

(Alliance News) - Schroder Japan Trust PLC on Thursday drew attention to elevated levels of uncertainty in the market, but expressed optimism around Japanese equities, as it posted interim net asset value gains.

The investor in Japanese equities said its NAV grew 18.9% in the six months that ended January 31, while its benchmark, the Tokyo Stock Price Index Total Return, or Topix, returned 15.3% over the same period.

NAV per share rose 16.8% to 348.47 pence, from 298.35p at July 31.

Chair Philip Kay described the interim trading as "solid", noting: "Masaki Taketsume's disciplined approach to stock selection proved effective once again, with strong contributions from holdings exposed to the generative artificial intelligence value chain and continuing corporate governance reforms."

He explained that the Japanese stock market underwent a "strong rally" during the period in question, with headline indices "repeatedly reaching record highs".

Kay added that the policy environment was supportive, with the Bank of Japan's "accommodative monetary stance and modest policy rate increases helping to underpin investor confidence".

Shares in the investment trust were trading 1.2% higher at 339.00 pence on Thursday morning in London.

Back in March, Schroder Japan Trust declared a second interim dividend for the financial year ending July 31 of 3.05 pence per share, up 5.5% from 2.89p a year prior.

Looking ahead, Chair Kay noted that rising geopolitical tensions and ongoing conflict are contributing to "elevated levels of uncertainty", indicating that investor sentiment will likely remain sensitive in the short term.

However, the chair added: "Even so, the board continues to view the outlook for Japanese equities positively. Continued progress of corporate governance reforms, improving capital discipline, and the gradual shift away from deflation should provide supportive conditions for long-term investors."

By Christopher Ward, Alliance News reporter

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