JAPAN: STRATEGY: Early 2Q plays

Though initial releases don’t signal a full out recovery, optimism abounds for a late 4Q05 early 1H06 recovery in both GDP numbers fueled by a recovery in domestic consumption. Market Volatility will continue to be high as Yen/Dollar plays itself out, and oil prices continue to add pressure.

Recommendations:
JFE Holdings (Target: ¥4000)
Yamada Denki (Target: ¥6000)
Nippon Paper Group (Target: ¥500,000)
Honda (Target: ¥6,000)
Nissan (Target: ¥1,000) (prefer this to Honda, better European outlook with Ghosn return to France)
Sumitomo Chemical (Target ¥600)
Keyence (Target ¥25,000)