Japan has declared a state of emergency and announced a $990bn stimulus package in order to deal with the effects of Covid-19. While the number of cases in the world’s third-largest economy remains relatively low for now, a sharp increase in major urban areas in recent days has rattled the authorities. Prime Minister Shinzo Abe has also unveiled a mammoth stimulus plan worth 20% of GDP.
Japan is likely to attract increasing attention from income-seekers jaded by sweeping dividend cuts in other developed markets, Jim McCafferty of Nomura tells Reuters. About 50% of Japanese firms have net cash on their balance sheets, leaving them well placed to honour dividend commitments. By contrast, the same is true for just 18% of the 100 biggest US non-financial firms and just 21% in the UK. The Japanese market currently yields 2.8%.
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