Japan Weekly Kickstart

Latest edition · October 3, 2026

Japan Weekly Kickstart More than meets the AI

Goldman Sachs highlights its new Japanese AI value-chain framework, breaking down the ecosystem into semiconductor and data-center hardware layers alongside two new thematic baskets. Following the mid-2026 correction, valuations across Japanese AI beneficiaries appear more attractive despite lingering positioning concentration risks.

In this edition of Japan Weekly Kickstart, Goldman Sachs outlines its investment framework for Japan's AI theme, dividing beneficiaries into AI Semiconductor Ecosystem (SM1-5) and AI Data-Center Hardware (HW1-3), with SoftBank Group as a stand-alone coordinator. AI equities now constitute 48% of the Nikkei 225 and 25% of TOPIX, and are slated to contribute one-third of TOPIX EPS growth in FY26/27. While valuation multiples have moderated to neutral 3-year z-scores post-June correction, high ownership concentration warrants risk management. The firm reiterates its 12-month TOPIX target of 4,600 while overweighting Machinery, IT & Services, Banks, Electrical Appliance & Precision, and Steel & Nonferrous.

Key takeaways from the latest edition

• 1.AI-related stocks account for 48% of the Nikkei 225 and 25% of TOPIX, and are projected to drive one-third of TOPIX EPS growth in FY26/FY27.
• 2.Following the late June correction, valuations across Japan's AI value chain offer an improved risk/reward profile with forward 24-month P/E 3-year z-scores near zero and 1-year z-scores deeply negative.
• 3.Goldman Sachs established a value-chain framework categorizing Japan's AI universe into Semiconductor Ecosystem (SM1-5) and Data-Center Hardware (HW1-3), introducing dedicated baskets GSJPAISM and GSJPAIHW.

What this series covers

• Summary of the week
• Market Dashboard
• Strategy Focus
• Valuation/Performance
• Flows/Positioning/Earnings Momentum
• Style/Baskets
• Sector Performance/Revisions/Valuations
• Performance table (by sector)
• Best-Worst spread table (by sector)
• Sector Dashboard

Edition archive

• Japan Weekly Kickstart More than meets the AI

  October 3, 2026

• Japan Weekly Kickstart AI and Financials leading the increase in liquid Japanese names

  September 25, 2026

• Japan Weekly Kickstart Has it been better to travel or to arrive with the BOJ

  September 18, 2026

• Japan Weekly Kickstart Investor concerns remain elevated regarding macro risks

  September 11, 2026

• Japan Weekly Kickstart Bimonthly flows update

  September 4, 2026

• Japan Weekly Kickstart 1Q 3 27 results summary

  August 14, 2026