Berkshire Hathaway Inc raised its stake in five of Japan’s trading houses to an average of more than 8.5 percent, in a move to double down on some of Warren Buffett’s favorite stocks.
Berkshire holds stakes in Itochu Corp, Marubeni Corp, Mitsubishi Corp, Mitsui & Co and Sumitomo Corp, the US insurer said in a release yesterday.
Buffett, the chairman of Berkshire, in April said that the firm would boost stakes in the Japanese companies, prompting their stock prices to rise to a record high.
Photo: Bloomberg
Buffett traveled to Japan in April to convene with executives from the trading firms for the first time in a whirlwind of meetings that both sides proclaimed as a success.
The conglomerates, which do everything from gas trading to salmon farming, announced a surge in profits last fiscal year on the back of high commodity prices and the weak yen.
The billionaire investor’s endorsement, combined with signs of stable inflation and better shareholders returns including buybacks have helped propel Japanese stock to a 33-year high.
The TOPIX Wholesale Trade Index — which includes Mitsubishi and other peers — has soared 39 percent this year, overtaking electric appliance makers.
The upside might be limited from here as the market has already factored in further purchases by Buffett, T&D Asset Management Co chief strategist Hiroshi Namioka said.
“It is unlikely to have a further significant positive impact on Japanese equities as a whole from here,” he said.
Berkshire plans to increase investments to up to 9.9 percent of each of the five Japanese firms.
“The company will make no purchases beyond that point unless given specific approval by the investee’s board of directors,” the release said.
Interest in Japan is surging as fears of sudden tech crackdowns in China prompt investors to re-evaluate Tokyo’s slower pace of change.
Buffett’s interest in Japanese trading houses has prompted more investors to look at different asset classes there, including private equity and venture capital, Coral Capital Inc chief executive officer James Riney said in an interview with Bloomberg TV yesterday.
“When it comes to investing on long-term time horizons, these investors want predictability,” he said. “Right now, China is not offering that. Japan is offering that.”
Chinese technology giants including Huawei Technologies Co (華為) and Baidu Inc (百度) as well as start-ups are stockpiling high bandwidth memory (HBM) semiconductors from Samsung Electronics Co in anticipation of US curbs on exports of the chips to China, three sources said. The companies have ramped up their buying of the artificial intelligence (AI) capable semiconductors since early this year, helping China account for about 30 percent of Samsung’s HBM chip revenue in the first half of this year, one of the sources said. US authorities are planning to unveil an export-control package this month that would impose new restrictions on shipments
‘WORLD’S CHIP GATEKEEPER’: Advocacy groups urged the US justice department to investigate Nvidia, saying it had ‘bullied its way into a prominent investment position’ Antitrust tensions are heating up in the chipmaking industry, as rivals have accused Wall Street darling Nvidia Corp of abusing its market dominance in selling chips that power artificial intelligence (AI) — and the US Department of Justice is now investigating these complaints, technology news site The Information reported. The news outlet, which cited unnamed sources familiar with the discussions, said that justice department officials are looking into concerns that Nvidia is potentially cornering the market and pressuring its customers to unfairly retain business. That includes allegations of Nvidia threatening to punish those who buy products from the Santa Clara, California-based tech
HYPE VERSUS REALITY: Amazon and Microsoft shares slid after their earnings reports because of fears that their big AI investments are not paying off for them After a jam-packed week of earnings reports from megacap technology companies, one thing is clear: As profits slow, investors are not impressed by artificial intelligence (AI) promises anymore. They want to see results. With six companies inside a group known as the “Magnificent Seven” already having reported, year-on-year earnings growth has slowed to nearly 30 percent in the second quarter, down from 50 percent in the previous period. Analysts said they expect that rate to decelerate further, to about 17 percent for those companies in the third quarter. Results from Microsoft Corp, Meta Platforms Inc, Amazon.com Inc and Apple Inc last week signaled
Hong Kong carrier Cathay Pacific Airways Ltd (國泰航空) yesterday said that it would buy at least 30 Airbus SE A330-900 aircraft in a deal valued at US$11 billion as it looks to build on a post-COVID-19 recovery and reach pre-pandemic passenger numbers next year. The firm made the announcement as it reported a drop in profit in the first half of the year, having moved into the black for the first time in four years last year thanks to a pickup in post-pandemic demand. Cathay did not disclose the total price of the planes, but said it had received “significant price concessions”