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Berkshire Hathaway has raised its stake in five Japanese trading houses, averaging over 8.5%, to further invest in Warren Buffett's favored stocks. The company holds stakes in Itochu, Marubeni, Mitsubishi, Mitsui & Co, and Sumitomo Corp. This move by Berkshire has led to record-high stock prices for these Japanese companies.
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Buffett's successful meetings with Japanese trading firm executives in April, coupled with rising profits from conglomerates involved in gas trading and salmon farming, have boosted Japanese stocks to a 33-year high. The Topix Wholesale Trade Index, including Mitsubishi and peers, has surged 39% this year, surpassing electric appliance makers.
Why it matters
Japanese firms, including Mitsubishi, are using proceeds from last year's energy price surge for buybacks. However, the market has already factored in Buffett's additional purchases, limiting upside for these stocks and Japanese equities overall. Berkshire plans to invest up to 9.9% in each of the five Japanese firms, subject to board approval.
