While the currency’s depreciation typically supports Japanese stocks, investors are concerned that political stability will put Prime Minister Shigeru Ishiba’s position in doubt. Futures for the Nikkei 225 traded in Chicago opened lower, suggesting the market in Tokyo may start the session down more than 1%.
The yen fell to three-month low and futures pointed to a drop in Japanese stocks Monday after the Liberal Democratic Party and its coalition partner were dealt a heavy blow in a snap election.
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.
