Newscasts - Asia Markets Briefing: Yen tumbles after defeat for Japan's ruling coalition

Korea Zinc

28/10/2024 09:07

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Source: 'Reuters - Business videos'

Description: Defeat for Japan's ruling coalition sent the Yen to a three-month
low on Monday, giving the Nikkei's exporters a lift. Investors appear
concerned that the government that emerges from Saturday's election may
struggle to preside over interest rate increases.
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Video Transcript:

Defeat for Japan’s ruling coalition sends the Yen to a three-month low.
Welcome to Asia Markets Briefing I'm Thomas Warner. The makeup of Japan’s
next government was influx on Monday after voters chose to punish the
country's Liberal Democrats. Prime Minister Shigeru Ishiba’s party and
its junior coalition partner secured just 215 seats in Japanese lower house,
down from 279 and well short of the 233 needed for a majority. The result
leaves no party with a clear mandate to lead the world's fourth largest
economy. On Monday, the Yen was trading at more than JPY153.00 to the Dollar
for the first time since July. Currency traders told Reuters that the election
is likely to produce a government without the political capital to preside
over rising interest rates. The Bank of Japan is now expected to stand pat
when it meets on Thursday. The tumbling Yen did give the Nikkei's exporters a
boost though. Its powerhouse carmakers were among the main beneficiaries, with
Toyota and Nissan both up more than 3%. Chip stocks also benefitted. Gains
elsewhere in Asia were more modest at the start of what may turn out to be a
jittery week. Traders have one eye on next week's US Presidential Election, as
well as a meeting of China's top legislative body. Politics also made its way
into the commodity markets on Monday. Oil prices fell more than $3.00 a barrel
on hope for de-escalation in the Middle East. Israel's retaliatory strike on
Iran over the weekend, bypassed Tehran's oil and nuclear facilities without
disrupting energy supplies. ICE Brent was last seen trading at around $72.75 a
barrel, on track for its lowest close in four weeks. And staying in
commodities, Korea Zinc said on Monday that its secured 9.85% of the company's
shares in a $1.5 billion share buyback. It's part of an attempt to block
shareholders from selling their stakes to the company's top investor, Young
Poong, and a private equity firm, MBK. The ongoing battle raised investor
expectations for a prolonged takeover battle, driving Korea Zinc shares to a
new record high on Monday. Shares in Japan’s Olympus moved the other way,
though dropping 6% after the board sacked CEO Stefan Kaufmann. The German
national had been accused of buying illegal drugs. The stock has
underperformed the Nikkei so far this year, up 16% against 38% for the wider
index. Indian airline IndiGo's shares fell 8% on Monday, set for their worst
session since March of 2022. The carrier said that it expects per passenger
revenue to drop, following its first quarterly loss in two years. It blamed
higher costs for fuel and higher expenses related to aircraft groundings. And
finally, Maruti Suzuki is due to report on its second quarter on Tuesday. The
Indian subsidiary of Japan’s Suzuki is India's largest carmaker. But the
wider sector has been hit hard this year by a slowdown in new car sales.
Investors will be keen to see how sales are holding up, particularly in the
compact segment. And that's it for your Asia Markets Briefing