TOKYO: Japan’s Nikkei share average inched higher on Thursday after three straight sessions of falls, with market participants focussing on the upcoming lower house election.
The Nikkei had risen 0.19% to 38,177.51 by 0130 GMT, after earlier falling to its lowest since Oct. 2 at 37,712.19.
Local media have reported that the ruling Liberal Democratic Party (LDP) and its coalition partner Komeito may lose their majority in the Oct. 27 election.
Prime Minister Shigeru Ishiba dissolved the lower house of parliament on Oct. 9, setting up the snap election.
“The market has priced in the risks of a defeat for the ruling coalition and opposition parties may not boost as many seats as expected because the voting rate may be low,” said Shuji Hosoi, senior strategist at Daiwa Securities.
“The Nikkei may turn negative later because the overall market has not gained momentum and volatility is still high.”
The Nikkei 225 Volatility Index rose 16% to 32.5.
Tech shares lead Japan’s Nikkei higher in choppy session
The Mainichi newspaper reported the ruling coalition may not reach 200 seats for an outright majority in the 465-seat chamber.
The market is worried about the stability of the government, said Takamasa Ikeda, senior portfolio manager at GCI Asset Management.
“The LDP would have a hard time passing bills if the coalition loses the majority. The government may become a lame duck,” Ikeda said.
The broader Topix was flat at 2,637.11.
Chip-testing equipment maker Advantest rose 1.63% to provide the biggest boost to the Nikkei.
Chip-making equipment maker Tokyo Electron gained 1.43%.
Technology investor SoftBank Group fell 1.94% to weigh on the Nikkei the most.
Robot maker Fanuc slipped 1%.
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