In today’s briefing:
- [Quiddity Index] Nikkei 225 Sep25 Rebal: One ADD/DEL? Kokusai a Question, but 2 Ad Hoc Events Coming
- [Japan Activism] Mitsui Matsushima (1518) Ups Buyback Tender to 35.8%, Murakami-San Group To Sell
- Nikkei 225 Outlook And Profit Targets Amid Uncertainty Over Japan-US Tariff Negotiations
- Nippon Steel (5401) – $14.2B U.S. Steel Bet Targets Growth, Faces U.S. Market Maturity Risks
[Quiddity Index] Nikkei 225 Sep25 Rebal: One ADD/DEL? Kokusai a Question, but 2 Ad Hoc Events Coming
- The March 2025 Nikkei 225 review came out with a sparse set of changes. That gives us hints for the September 2025 review.
- For the moment, that leads me to believe we get ONE ADD and ONE DELETE though up to three of each is possible.
- For now, Fast Retailing (9983 JP) capping is off, but there’s an ad hoc coming in late Q3 or early Q4 and the Sony Financial spinoff to look forward to.
[Japan Activism] Mitsui Matsushima (1518) Ups Buyback Tender to 35.8%, Murakami-San Group To Sell
- Today after the close, Mitsui Matsushima (1518 JP) announced it would increase its buyback from 3.5mm shares to 4.0mm shares (31.3% to 35.8%). It also announced a Tender Offer Buyback.
- The tender offer starts tomorrow and goes til mid-July, paid 8 August. Murakami Group will tender a minimum of 3.3mm shares (more likely 4.2mm).
- This is not a huge immediate win, but it’s OK. And it changes the structure of the company’s balance sheet, ROE, effective ROE, and possibly its dividend.
Nikkei 225 Outlook And Profit Targets Amid Uncertainty Over Japan-US Tariff Negotiations
- Japan PM Ishiba says disagreements remain with US on tariff talk. This is probably the main catalyst that could slow down the current Nikkei 225 (NKY INDEX) rally.
- Our WEEKLY Nikkei 225 model signals a mildly overbought status, the index could go higher, but will face harder resistance in 1-2 weeks from now.
- We don’t see the Nikkei pulling back this week, we think it will close this week up.
Nippon Steel (5401) – $14.2B U.S. Steel Bet Targets Growth, Faces U.S. Market Maturity Risks
- Nippon Steel has acquired U.S. Steel for $14.2 billion in cash, adding 23 Mt of crude steel capacity and a full U.S. and EU footprint.
- The acquisition marks a bold step toward NS’s “100 MT Vision,” diversifying earnings beyond Japan and strengthening presence in a geopolitically stable market.
- U.S. Steel remains heavily BF–based and tied to a structurally flat demand market; long-term steel consumption in the U.S. has declined, making returns dependent on aggressive modernization & macro tailwinds.
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