Yoshihide Suga Cabinet approval rating, 43.4%

June 22, 2021 (Tuesday) Cloudy Mercury retrograde (May 30 – June 23)

・Global uniform pricing, to Japan.

A global company raises prices by enhancing product value, linking it to wage increases.

Inflation is surging into Japan where this common sense no longer applies.

A turning point quietly sneaks into the Galapagos economy.

・This summer’s Tokyo Olympics: on the 21st, the government, the Tokyo Organising Committee, and Tokyo Metropolitan Government held a five-party online meeting with the International Olympic Committee (IOC) and the International Paralympic Committee (IPC) to officially decide to allow up to 10,000 spectators with a maximum 50% capacity for the event venues.

Tickets for events exceeding the spectator cap will be re-drawn among winners to reduce by about 900,000.

・Hong Kong-based Apple Daily, which has been critical of the Chinese Communist Party, announced on the 21st that it is considering ceasing publication.

Authorities are also considering lifting asset freezes; if freezes are not lifted, they plan to halt operations by the 25th.

Multiple media outlets reported on the 21st that employees are leaving in large numbers, with a potential early shutdown as soon as the 23rd.

・On the Tokyo stock market on the 21st, the Nikkei Stock Average fell 953.15 points (3.3%) from the previous close, marking the largest drop in about four months.

Following remarks by Federal Reserve officials on the 18th indicating a sooner rate hike in the latter half of 2022, concerns about a slowing global economic recovery spurred selling.

The Nikkei average closed at 28,010.93 yen, having fallen more than 1,100 yen at times, dipping below 27,800 yen. A four-day losing streak since March.

・As global economic recovery accelerates and inflation is anticipated, money flowing into stocks and commodities has begun to reverse and flee.

Last week, the Dow Jones Industrial Average posted its largest weekly drop of the year, and in Asia on Monday the 21st, including the Nikkei average, fell sharply.

There are voices in the market that the so-called inflation trade that had boosted stocks and commodities during the COVID-19 crisis is faltering.

・With the state of emergency over, Tokyo and Osaka Prefectures began permitting restaurants to serve alcohol under certain conditions from the 21st.

Industries are also seeing moves to reassess work-from-home restrictions.

・The share of the global COVID-19 infections caused by the Delta variant is rising rapidly.

It is more transmissible than previous strains, and infections are surging in the UK.

Vaccinations are progressing, and deaths and serious cases have not increased dramatically, but if the number of infections keeps rising, it could hinder the reopening of the economy.

・The Ministry of Land, Infrastructure, Transport and Tourism will create a system to centrally manage information on land and buildings nationwide using a common ID.

It will facilitate cross-referencing private real estate purchase data with national registries.

It will promote the spread of new services using artificial intelligence (AI) for asset appraisal, etc.

If the used housing market becomes active, it will also address vacant homes.

・A key reason why global markets suddenly started becoming volatile is that the direction of U.S. monetary policy has become unclear.

While the market had expected continued easing unless inflation accelerates, many FOMC members are leaning toward preemptive rate hikes.

There is wide dispersion among members’ views, and communication with the market could become a source of turbulence.

・In the U.S. market turning to lows, the Ark Investment Management’s ETF “ARK Innovation” rose on a counter-trend.

The ETF includes many high-growth tech stocks such as Tesla in the EV sector.

With long-term interest-rate concerns easing, capital flowed back into high-growth stocks, pushing the ETF price higher.

・As of 4:00 PM on 6/21, global COVID-19 infection and death numbers (Columbia University data) World total: 17849 million cases (60,76 deaths)

United States 33,541,967 (83) India 29,935,221 (1,427) Brazil 17,927,928 (1,025) France 5,819,088 (14) Turkey 5,370,299 (63) Russia 5,255,214 (445)

United Kingdom 4,646,068 (6) Argentina 4,268,789 (301) Italy 4,252,976 (17) Colombia 3,945,166 (599) Spain 3,757,442 (0) Germany 3,730,126 (10)

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