The Liberal Democratic Party won a landslide victory in the House of Representatives, and Morgan Stanley: may benefit the Nikkei Index

The House of Representatives of Japan held an early election vote, with the ruling Liberal Democratic Party winning overwhelmingly, securing 316 out of 465 seats in the House of Representatives. Morgan Stanley published a research report indicating that this election result may benefit the Nikkei index, with large-cap stocks, high liquidity, high beta stocks, and defense-related stocks expected to outperform the market in the short term.

Morgan Stanley stated that if an expansionary fiscal policy tendency is maintained during the budget review period, and Japan and the U.S. emphasize coordination on defense strategy, the effectiveness of the "high market trade" strategy is expected to temporarily continue. The team believes that the market should examine the actual effectiveness of Japan's "Department of Government Efficiency" (DOGE), and it is still too early to view the debate on consumption tax cuts as a positive factor for domestic demand-related stocks