Shares of major Japanese trading houses experienced a significant rally on Tuesday following news that Warren Buffett's Berkshire Hathaway has increased its stakes in these companies. The renowned 94-year-old investor's holding company raised its ownership in five prominent Japanese trading houses—Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo—by more than one percentage point each. This adjustment elevates their stakes to levels ranging from 8.5% to 9.8%, as highlighted in a recent regulatory filing.
Following the announcement, shares in all five trading companies surged by at least 4% shortly after the market opened. As of 10:05 a.m. local time, Itochu and Marubeni led the charge, recording impressive gains of 4.12% and 4.55% respectively. These movements reflect a broader confidence in the performance of Japan's largest trading houses, known as sogo shosha, which play a vital role in the country's economy by investing across diverse sectors both domestically and internationally.
Warren Buffett has previously expressed his commitment to increasing his investments in Japanese stocks, particularly focusing on these five largest trading houses. In his annual letter to shareholders released in February, he articulated his intentions, further solidifying his strategy to tap into the lucrative potential of Japan's trading sector. Berkshire Hathaway initially entered into these investments in the summer of 2019, and as of the end of 2024, its holdings in these Japanese companies are valued at approximately $23.5 billion, with an aggregate investment cost of $13.8 billion.
This latest move by Berkshire Hathaway not only amplifies its influence in the Japanese market but also reflects Buffett's long-standing belief in the growth potential of these trading houses. The strategic investments align with Berkshire's diversified portfolio approach, emphasizing long-term value in sectors that mirror its operational ethos.
As the global markets continue to navigate uncertainties, the positive performance of shares in these Japanese trading houses serves as a testament to the confidence that investors like Warren Buffett place in them. The implications of these investments are likely to resonate throughout the market, influencing future stock trends and investor sentiments in the coming months.
In summary, the recent increase in Berkshire Hathaway's stakes in Japan's major trading houses has sparked renewed interest in these stocks, leading to notable gains. As Buffett continues to champion investments in the sogo shosha sector, market analysts will be closely monitoring the performance and strategic moves of these companies.
