Mom-and-pop investors have been increasingly drawn to the corporate bond market in search of higher returns, after the Bank of Japan ended its negative interest policy in March 2024. Yields on Japanese government bonds, which serve as benchmark for corporate issues, have climbed amid rising inflation and market caution over Prime Minister Sanae Takaichi’s fiscal spending package.
While higher yields have raised companies’ borrowing costs, their appetite for funding remains strong. Japanese firms have raised a record ¥2.79 trillion through yen-denominated retail bonds so far in 2025, surpassing the previous high last year, according to data compiled by Bloomberg.
Earlier this month, SoftBank Group announced second-quarter net income that beat analyst expectations, on gains from its investments in artificial intelligence, according to its financial disclosure statements. One of the biggest contributors to this growth was its Vision Fund, which benefited from rising valuations of unlisted AI-related holdings such as OpenAI.
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On the same day, the company disclosed that it had offloaded its entire stake in Nvidia Corp for US$5.8 billion.
SoftBank Group’s shares have fallen roughly 30% in the past month as global momentum in AI stocks began to cool. Its credit default swap spreads — a measure of credit risk — have widened to their highest level in about four months.
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