Trading company sector investment strategy (June 2026)

Research evidence excerpt

Trading company sector investment strategy (June 2026)

9 June 2026

Mizuho Securities Equity Research Trading Companies

Industry Overview

Expecting Middle East situation to ease, 1Q results to drive share price rebound

Senior Analyst: Focus on Toyota Tsusho and Mitsui ahead of 1Q results

Kanako Mizuno With no end in sight to the turmoil in the Middle East, trading company stocks

+81 3 6202 8130 have been underperforming. While we view the impact of rising crude oil prices

kanako.mizuno@mizuho-sc.com and supply chain disruptions as a tailwind for the trading company sector, we

believe that investor interest is currently shifting toward other sectors where

demand is expected to grow, such as those related to AI. Potential catalysts

that could bring trading company stocks back into the spotlight include: 1) a

winding down of the turmoil in the Middle East; and 2) the announcement of

1Q FY3/27 results.

1) Winding down of turmoil in the Middle East

As the situation in the Middle East stabilizes and the impact of supply chain

disruptions and market prices on trading company earnings becomes clearer,

we expect the sector to be favored among investors. We do not look for energy

prices to fall sharply even after the Middle East situation stabilizes. This is

because we expect supply and demand to remain somewhat tight due to the

need to replenish released energy reserves, demand for regionally diversified

energy procurement, and the time required to resume operations at LNG

facilities that have been physically attacked. As we expect prices to decline

somewhat once the turmoil subsides, we will need to keep a close eye on

the impact of inventory valuation losses and the time lag involved in selling

products purchased at high prices in a market where prices have fallen.