Japan's ruling coalition, consisting of the Liberal Democratic Party and Komeito Party, experienced a significant defeat in the recent lower house elections. This has raised concerns among Tokyo bankers about the new government's commitment to revitalizing financial markets.

The outcome of the elections has introduced uncertainty into Japan's financial landscape, prompting a reevaluation of the country's strategic direction in the global financial arena. Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., believes that stakeholders will adopt a cautious wait-and-see approach to assess whether the government's asset management policies will continue. The market is likely to be cautious as it awaits further developments.