【Expert Analysis】How Will the Market React to the LDP Leadership Election Results? What's Next for the Market?
After Prime Minister Ishiba's resignation announcement, the Tokyo stock market has been on an upward trend, with the Nikkei Stock Average breaking the 45,000 yen mark for the first time and repeatedly hitting record highs. How will the results of the Liberal Democratic Party leadership election scheduled for the 4th affect stock prices and exchange rates from next week onwards? We asked market experts.
Key Points:
1. Clarification of policy pledges and concrete roadmap 2. Unity within the party and direction on new coalition arrangements 3. Balance between fiscal stimulus and fiscal reconstruction, including regulatory reform 4. Diplomatic approach to dealing with President Trump's upcoming visit to Japan
According to market experts, confidence in economic and fiscal management is crucial. While significant fiscal spending is important for stock price increases, amid rising long-term interest rates, mere spending could lead to rising interest rates and falling stock prices. The ability to demonstrate responsibility for fiscal policy while utilizing fiscal resources in areas with high economic stimulus effects is a critical point.
Public Opinion Survey Results (How do you predict future stock price trends?): - Expect significant increase: 18.9% - Expect moderate increase: 25.6% - Expect to remain flat: 5.4% - Expect moderate decline: 15.7%
Main Concerns: The relationship between fiscal expansion and interest rate increases remains a key concern for market participants.
Source: Nippon TV NEWS NNN / Yahoo! News Japan Date: October 3, 2025 (Friday) 13:12