iShares MSCI Japan Value ETF

EWJV

Market cap $715M

I am bullish on Japanese equities, emphasizing that Japan's high debt/GDP is offset by a robust asset base and pension fund scale. Japan's Government Pension Investment Fund and BOJ asset accumulation provide significant competitive advantages and underpin market resilience.

Japan equities are riding a historic surge, with the Nikkei 225 topping 62,000 for the first time. While the S&P 500 and Nasdaq continue to notch records, Japan is carving out its own bull market, driven by AI-fueled tech gains, structural corporate reforms, and a transformative era of economic policy.

BOJ holds rates at 0.75% but lifts inflation outlook amid Iran war risks. Yen ETF FXY and value ETF EWJV come into focus.

The Bank of Japan kept its policy rate at 0.75% but raised inflation forecasts and trimmed growth views as it warned about the impact of a spike in energy prices.

The BOJ also cuts its growth forecasts for the fiscal year 2026 to 0.5% from 1%. The bank raised its core inflation forecasts to 2.8% from 1.9%.

The iShares MSCI Japan Value ETF has delivered solid gains so far in 2026, boosted by attractive valuations and lower political risk in Japan. While recent energy price volatility is likely to negatively affect earnings growth at cyclical Japanese companies, I rank EWJV a Buy for investors focused on long-term total returns. EWJV holdings trade at a steep discount relative to the S&P 500, indicating a significant margin of safety as long as the Japanese economy does not enter a recession.

Japan's Nikkei 225 hits a record as Sanae Takaichi's election win fuels stimulus hopes, lifting investor appetite for Japanese ETFs like EWJ.

iShares MSCI Japan Value ETF trades at a 14.15 P/E, significantly cheaper than U.S. value ETFs. EWJV benefits from Japan's recent rate hikes, potential Yen appreciation, and remains attractively valued at 84% of Graham's intrinsic value metric for the entire ETF as an average. The ETF's top holdings include Toyota and major Japanese trading houses, with a low 3-year standard deviation of 10.94%.

Core inflation, which strips out prices of fresh food, remained unchanged from 3% in October, and came in line with Reuters-polled economists' average estimate.

Nikkei 225 struggles below 50,000 as upside momentum fades. Daily RSI drifts into neutral territory, signaling consolidation.