Key Facts
• July 25: U.S.-Japan tariff agreement reduces global economic uncertainty.
• Nikkei 225 forecast raised to 45,000 by fiscal year-end 2025.
• Daiwa Securities revised 2025 year-end Nikkei forecast from 42,000 to 44,000.
• Nomura Securities increased 2025 year-end Nikkei forecast to 42,000 from 39,500.
• S&P 500 projected at 6,800 by 2025 year-end, up from 6,400.
• Tariff reductions expected to ease U.S. inflation concerns and support economic stability.
• Bank of Japan may advance rate hikes to Q4 2025, earlier than Q1 2026.
• Domestic political uncertainty could impact interest rates and stock market sentiment.
• Corporate earnings outlook shifted from a 1.6% decline to potential growth.
• TOPIX forecast for 2025 year-end raised to 3,000 from 2,850.
Summary
Following the U.S.-Japan tariff agreement, domestic securities firms have raised their stock market forecasts, citing reduced global economic uncertainty. Daiwa Securities predicts the Nikkei 225 will reach 45,000 by fiscal year-end 2025, while Nomura Securities projects 42,000 by the same period. The agreement is expected to ease U.S. inflation concerns and support economic stability, with the S&P 500 forecasted at 6,800 by 2025 year-end. However, the Bank of Japan may advance rate hikes to Q4 2025, potentially affecting market momentum. Political uncertainty and interest rate changes remain key risks. Corporate earnings, initially expected to decline, now show potential for growth, further supporting market optimism.
