Japan’s Topix Index hit its highest point since August 1990, a sign that foreign investors are back.

The Tokyo Price Index, also known as Topix, has gained more than 6% year-to-date. The broad-based index, made up of about 2,000 constituents, has outperformed its regional peers in the Asia-Pacific.

The Topix rose 0.6% on Tuesday and continued to trade higher on Wednesday, led by utilities, consumer cyclicals, technology and financials. Shares of Tokyo Electron, Oriental Land, Softbank Group, Sony and Nintendo were among the top gainers on Wednesday morning.

“Foreign investors are back – which says something about the nature of the equity market recovery in Japan,” Societe Generale’s Asia equity strategists Frank Benzimra and Tsutomu Saito said in a Tuesday note.

“That is a less [of] a duration trade than a broad-based upturn based on fundamentals, robust domestic demand, and more generous distribution policy (share buybacks accelerate),” he wrote.

The firm noted that foreign investors bought a net 2.1 trillion yen ($15.4 billion) worth of Japanese stocks in April – adding that Japan’s corporate sector remains the largest net buyer of Japanese stocks, with a volume of 1.1 trillion yen year-to-date.

The Nikkei 225 also rose to the highest since November 2021, also led by industrial names including NSK, Mitsubishi Materials, and Nippon Sheet Glass. The index topped the psychological level of 30,000 on Wednesday morning.

Earlier this year, shares in Japan’s top five trading houses saw a boost in prices after chairman and CEO of Berkshire Hathaway Warren Buffett raised his stakes in the firms and hinted that he may increase his holdings even further.

Monex Group’s Jesper Koll told CNBC that Buffett’s recent trip to Japan to meet with the trading companies was considered a “stamp of approval” for investing in Japan.

They expect the central bank to widen its yield curve control band to 100 basis points above and below its target for 10-year Japanese Government Bonds of 0%.

Such a move would “be bullish for the yen, but not automatically bearish for share prices as the yen remains in deep undervalued territory,” the strategists wrote, adding that the corporate sector would have a competitive advantage to the YCC band being widened.

The Bank of Japan shocked bond markets in December when it last widened the range from 25 basis points to 50 basis points.

The Japanese yen traded at slightly weaker levels to 136.43 against the greenback on Wednesday.

At Kazuo Ueda’s first meeting as central bank governor, the Bank of Japan made no changes to its monetary policy while announcing a policy review ahead.

SocGen strategists said the BOJ’s change in monetary policy will likely be a “very gradual process with no elimination of the YCC [Yield Curve Control] policy and interest rate hikes expected in the next two years.”

“Keep an overweight position on Japan equities, unhedged, and biased to banks, financials, and value,” they wrote.