Yen Falls, Japan’s Stocks Rise as Traders Weigh Election Impact
The yen fell to three-month low while Japanese stocks climbed Monday as as investors mulled the implications of the Liberal Democratic Party and its coalition partner losing their majority. Government bond yields were poised to rise.
The currency weakened as much as 0.6% against the dollar, before trimming some of the move, with the slide coming after four straight weekly declines. That’s again raised the risk that authoritiers may wade back into the market to protect the yen.
While political instability is typically negative for equities, there is still a possibility that Prime Minister Shigeru Ishiba can secure enough support to stay on. The weakness in the yen also tends to support the share market.
The tech-heavy Nikkei 225 gauge and the broader Topix index both opened slightly lower before quickly turning to gains of 1.5% and 1.8%, respectively.
Source : Bloomberg
