Nikkei Index Soars Over 2%... Impact of LDP Securing Majority Seats in General Election

[Image source=AP Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] On the 1st, the Japanese stock market is experiencing a sharp rise.

This is attributed to the ruling Liberal Democratic Party (LDP) securing a stable absolute majority of seats in the House of Representatives election (general election) held the previous day.

At the Tokyo Stock Exchange, the Nikkei 225 average price recorded 29,576.68 points as of 9:51 AM, up 2.37% (683.99 points) compared to the previous trading day's closing price.

The Japanese stock market, which started with a gap-up, is reacting positively to the LDP led by Prime Minister Fumio Kishida securing more than a simple majority (over 233 seats) and reaching the absolute stable majority threshold of 261 seats in the general election held the previous day.

The absolute stable majority means holding all chair positions of standing committees and having more than half of the committee members.

Although this is 15 seats fewer than the previous 276 seats, many in the market had expected a much larger decrease in LDP seats, raising concerns about a potential decline in policy execution power.

In this regard, the Nihon Keizai Shimbun analyzed that the buying momentum is growing because, unlike initial expectations, the LDP secured an absolute stable majority that allows it to pass bills independently, enabling stable parliamentary operations, amid rising major indices in the U.S. New York stock market on the last trading day of last week.

This content was produced with the assistance of AI translation services.