Yoshihisa Nakagawa, a senior fund manager of Japanese equities for Tokio Marine Asset Management, is stock picking his way through the next few months as he assesses the next stage of the Japanese market’s recent rally.

Following a 31.7 per cent jump since falling to a 26-year low on March 10 and a 7.4 per cent gain so far this year, he expects the market to pause for breath before continuing its climb, from a Topix level of 926.80 to around 1,100 or 1,200 early next year.