Exchange traded funds such as iShares MSCI Japan ETF (NYSEArca: EWJ), WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ) and the Deutsche X-trackers MSCI Japan Hedged Equity ETF (NYSEArca: DBJP) were dragged lower by the decline in Chinese stocks last month, but plenty of market observers have been out in recent days highlighting opportunities with Japanese equities.

The Nikkei was seen as a valuation play after the index gave up all its gains for the year on Tuesday, with analysts pointing out that Japanese companies’ record profits were not reflected in their relatively low stock prices compared to earnings.

Additionally, Japanese equities were rising on an optimistic Chinese economy, a major export market for Japan. China’s finance ministry said Tuesday that Beijing will implement a “more forceful” fiscal policy to stimulate growth, allocate funds to support infrastructure and cut taxes for small businesses. [Japan ETFs Get a Positive Jolt]

Bolstering the case currency for hedged Japan ETFs, such as the aforementioned DXJ and DBJP along with the iShares Currency Hedged MSCI Japan ETF (NYSEArca: HEWJ), Goldman Sachs said Tuesday it expects more downside ahead for the yen.

The Bank of Japan “is on course to boost monetary stimulus, weakening the yen to 130 versus the dollar within 12 months, Goldman Sachs analysts, including Robin Brooks, the chief currency strategist in New York, wrote in a report,” reports Netty Ismail for Bloomberg.

Looking at equity valuations, Japanese stocks look cheaper than the U.S. For instance, EWJ shows a 16.0 price-to-earnings ratio and a 1.4 price-to-book, whereas the S&P 500 index is trading at a 18.7 P/E and a 2.5 P/B.