Today's edition of the Saxo Morning Call features the SaxoStrats team discussing the continuing weakness of the US dollar as commodity prices recover ground and in the wake of key US equity indices hitting all-time highs Thursday.
Article / 23 October 2017 at 7:00 GMT

Morning Markets: Abe win drives Japanese shares higher

Head of Editorial Content / Saxo Bank

Morning Markets


  • EU: Flash Consumer Confidence (1400 GMT)
  • CA: Monthly Wholesale Sales: (1230 GMT)

Japanese prime minister Shinzo Abe won an easy electoral victory this weekend, with his Liberal Democratic party coalition now in possession of a parliamentary supermajority that expands his mandate for constitutional reform and his Abenomics programme designed to jolt the Japanese economy out of its prolonged stagnation.

Abe’s victory was met Monday by a Nikkei rally that took the index up 1.11% while the yen headed lower with USDJP rising to the 1.1375 area. According to CNBC, however, only half of Japanese voters were willing to endorse Abe’s performance to date in a recent poll, meaning that while the PM may have come out well ahead of a hapless opposition, approval ratings are likely to be an issue as Abe pushes ahead with planned changes. 

Elsewhere in Asia, Hong Kong shares fell by 0.64% as financials headed lower while Australian stocks fell by 0.22% on the back of industrial and real estate declines as well as a stronger AUD.

Oil prices remain supported by clashes between Iraqi and Kurdish forces with the former having now taken the oil-producing Kirkuk province and pushing ahead to the capital or Erbil. In Europe, the Catalan regional parliament is set to agree on a response to Madrid’s imposition of direct rule in the breakaway province, a move that Catalan leader Carles Puigdemont has called “the worst attack on insititutions since Franco”.

On the data calendar, today sees the EU flash consumer confidence indicator out at 1400 GMT.

Market signals

Asian session

  • Japanese Prime Minister Shinzo Abe won victory in lower house elections on Sunday
  • Abe's ruling coalition is expected to retain its two-thirds majority in parliament
  • The Nikkei surged and was up 1.11% at its close
  • Other Asian markets were mixed; the ASX 200 closed down 0.22% to 5,894
  • China's new-home prices rose 6.3% in September against the same month last year
  • The result represents a deceleration from the 8.3% year-on-year expansion in August
  • ANZ Bank reached a settlement with the securities regulator over rate-rigging allegations 
  • Markets in New Zealand and Thailand are closed for a public holiday

Forex ahead

  • The yen was at three-month lows after Shinzo Abe's election win
  • The euro eased as Spain’s constitutional crisis fueled concerns about political unity 
  • Sterling is on the rise with the 1.32 level in focus for cable
  • AUDJPY rose by 0.65% in the wake of Abe's commanding electoral victory

From the Floor

QT soon?The ECB is the highlight of the week, we’ll be looking for news of a taper schedule,” says Hardy

Victory in Japan.Foreign investors will increase their exposure to Japanese equities after Abe’s win,” says Garnry 

Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.

In opinion

Ore rise
Australia's mining shares were higher after spot iron ore prices rose 2.6% on Friday, says Saxo Capital Markets (Australia). And sentiment continues to remain positive.

Abe it is
Shinzo Abe was easily re-elected as Japanese Prime Minister and the market responded overwhelmingly positively, says Saxo's Singapore team.

It's all bull
With the US jobs market at white-hot levels and global growth looking strong, this is a bull market by any name, says Kay Van-Petersen.


 The Nikkei rose and the yen fell following Shinzo Abe's 
resounding election win. Photo: Shutterstock

Morning Markets goes out on the TradingFloor platform at 07:00 GMT, Monday to Friday.
Click here
to make sure you're up to date with the latest developments.


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail