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89hot
90.2% above its 10-year average | Data for Sep 2026
Hot and cold describe position, not good or bad: warm does not mean a fall is coming, and an extreme reading does not mean a quick reversal. We describe history only, with no buy or sell advice.
What it is
The monthly average of Japan’s share price index, as compiled by the OECD.
Japanese stocks are closely tied to the yen, and exporters’ profits depend heavily on the exchange rate.
Where it stands now
coldcoolneutralwarmhotHatched = earlier periods that were also hot
When it was here before
Japan stocks after it began, cumulative1 yr2 yr3 yr
For each period, the changes 1, 2 and 3 years after it began are cumulative and measured from its first month; “What happened next” is measured from every hot month, so the two give different numbers. The events named beside each period are major events of that time, not necessarily related to the readings here.
What happened next
Bars: median cumulative changeEarlier months with Japan stocks hot, excluding the current period (75)All months (575)
Median of the deepest drop below the starting month within the next 5 years: −9.6% for months with Japan stocks hot; −19.1% for all months.
The hot months come from a small number of market episodes (3), and neighboring months are not independent events; rises and falls are all listed. This is the historical record, not a forecast.
| Median position | Back to neutral (40–60) | Still hot or more extreme | |
|---|---|---|---|
| 1 yr later | 87hot | 1% | 80% |
| 3 yr later | 77warm | 1% | 49% |
| 5 yr later | 5cold | 1% | 16% |
Has hot or cold lined up with later returns?
1978–2021: average yearly change in Japan stocks over the next 5 years
There is no clear relationship between hot or cold and what came next. The gaps between the bars are not consistent across months (rank correlation below 0.25); this is a record of the past, not a forecast.
What it is linked to
USD/JPYtoJapan stocksCommon explanation: Cause · yen strengthens, Japan stocks fall
A stronger yen squeezes exporters’ profits in yen terms
This issue: USD/JPY at 94 (hot), Japan stocks at 89 (hot) — both above normal, in line with the common explanation.
Weak or inconsistentAgreement +0.59 · in step in 19 of 31 5-year periods
Values
Data and sources