日股日元齐涨，高市早苗让步，市场选择暂时相信！

Core Viewpoint - The market's reaction post-Japan's election indicates a temporary "presumption of innocence" towards Prime Minister Fumio Kishida, as investors believe his overwhelming victory will provide policy clarity and reduce risks associated with fiscal conditions [1][3]. Market Reaction - Following the election results, Japan's stock market surged to a historical high, with the Nikkei 225 index rising by 5.7% to surpass 57,000 points [1]. - The Japanese yen and government bond markets remained relatively stable, contrary to previous volatility concerns regarding fiscal sustainability [1][5]. Policy Stability Expectations - Investors' positive response is largely driven by expectations of policy stability, as Kishida committed to funding tax cuts through non-tax revenues and subsidy reviews rather than issuing deficit bonds [3][7]. - The ruling coalition's "supermajority" in the House of Representatives reinforces market confidence in policy continuity and manageability [3]. Stock Market Insights - The election results have led to a significant increase in stock market forecasts, with JPMorgan raising its year-end target for the Nikkei 225 index to 61,000 points due to enhanced political stability expectations [4]. - Analysts believe that sectors benefiting from Kishida's spending plans, such as defense and semiconductors, may experience a new wave of growth [4]. Bond Market Reactions - Despite initial concerns about Kishida's expansionary policies leading to bond sell-offs, the Japanese government bond market showed relative stability after policymakers issued reassuring signals [5][7]. - The 10-year Japanese government bond yield initially rose by 4 basis points to approximately 2.27% but quickly retreated, alleviating fears of disorderly selling [5]. Currency Movements - Contrary to typical expectations, the yen strengthened against the dollar, rising by 0.6% to 156.22, distancing itself from the intervention-triggering 160 level [8][11]. - Analysts attribute this unusual movement to Kishida's commitment to fiscal sustainability and the finance minister's statements on stabilizing the yen [11]. Future Outlook - The market's focus will shift to how Kishida implements his "bold measures," with plans for a visit to the U.S. and discussions on defense spending and investment commitments [12]. - While the market currently finds comfort, future challenges remain, particularly regarding the details of fiscal expansion plans, which could lead to increased volatility in the bond market [12].