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Index IDEA: Russell/Nomura index rebalance reflects growth in Japan equities

Last week, Japan reported a 1.4 percent annualized GDP growth rate for the third quarter, slightly above the media estimate of 1.3 percent. Notably, this represents the seventh straight quarter of Japanese economic expansion, nearly matching an eight quarter run from the second quarter of 1999 through the first quarter of 2001. 

Reflecting this environment, FTSE Russell and Nomura Securities Co., Ltd. announced earlier this week that 151 new stocks were added to the Russell/Nomura Total Market Index as part of its annual rebalance, effective 20 November. And, importantly, the total market capitalization of the Index, which captures 98% of the float-adjusted market capitalization of the Japanese equity market, rose 28% from last year's rebalance.[1] 

Catherine Yoshimoto, senior product manager, FTSE Russell:

"We certainly saw a rise in the Japan equity market in the last year as reflected by the growth of the Russell/Nomura Total Market Index, which is not unexpected given the solid GDP growth in Japan. Interestingly, in the last year among Japanese stocks, we have seen a shift toward value orientation for the Land Transportation and Retail Trade sectors and a shift toward growth orientation for the Electric Appliances, Chemical and Machinery sectors." 

To view a 2016 research paper highlighting key design features of these indexes - Russell/Nomura Japan Equity Indexes: 20 years of excellence - go to the FTSE Russell website



[1] Source: FTSE Russell. Data from October 14, 2016 through October 13, 2017. Past performance is no guarantee of future results. Please see the end for important legal disclosures.


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Views expressed by Catherine Yoshimoto of FTSE Russell are as of November 22nd and subject to change. These views do not necessarily reflect the opinion of FTSE Russell or the LSE Group.

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