According to a research report, Goldman Sachs has raised its allocation to Japanese stocks from "neutral" to "overweight." This adjustment reflects the view of the firm's Japan portfolio strategy team, which has increased its 12-month target for the Topix index from 3900 to 4300 points. The team cited their belief that Japanese Prime Minister Sanae Takaichi's recent election victory should drive increased net foreign capital inflows and valuation expansion at the index level. Goldman Sachs strategists expressed a positive outlook for Japanese stocks related to defense, critical resources, shipbuilding, power resources, the theme of US reindustrialization, and corporate governance reforms in the first half of the year.