The surge in the yen has triggered a sell-off in Japanese stocks. Strategists say the exchange rate still has room to buffer against corporate assumptions, and the risk of profit downgrades is low.

Zhitong Financial APP has learned that on Monday, the Japanese yen surged significantly, triggering a sell-off in the Japanese stock market. However, the yen exchange rate has failed to break through the critical level used by many companies to formulate their profit forecasts, leaving room for a market rebound. Currently, the yen exchange rate is still about 5 yen away from the 1 dollar to 151.49 yen threshold. This rate is the weighted average expectation derived from a survey of over 800 companies conducted by the Bank of Japan. Strategists indicate that this buffer zone should be able to limit the impact of exchange rate fluctuations on the profits of exporting companies, thereby allowing room for stock prices to rise after these companies report their earnings.