Asian markets hold steady despite Japan's government crisis as Tesla, Alphabet set to report this week
Investors were also hoping for some progress in trade talks ahead of President Donald Trump's August 1 tariff deadline, with US Commerce Secretary Howard Lutnick still confident a deal could be reached with the European Union.
There were reports Trump and Chinese leader Xi Jinping were closer to arranging a meeting, though likely not until October at the earliest.
In Japan, the ruling coalition lost control of the upper house in an election on Sunday, further weakening Prime Minister Shigeru Ishiba's grip on power as a tariff deadline looms.
Ishiba expressed his intention to stay in the position, which along with a market holiday, limited the reaction and the yen was 0.4 per cent firmer at 148.29 to the dollar.
"Ishiba will try to govern with support from some within the opposition, but this likely means a looser fiscal policy and is not good news for bond yields," said Rodrigo Catril, a senior FX strategist at NAB.
"History also suggests that domestic political uncertainty tends to keep the BOJ on the side-lines, so the prospect of rate hikes is now set to be delayed for a little bit longer."
The Bank of Japan still has a bias to raise rates further but markets are pricing little chance of a move until the end of October.
While the Nikkei was shut, futures traded up at 39,875 and just above the cash close of 39,819.
MSCI's broadest index of Asia-Pacific shares outside Japan was flat, while South Korean stocks added 0.4 per cent.
Mega caps kick off
S&P 500 futures and Nasdaq futures both edged up 0.1 per cent, and are already at record highs in anticipation of more solid earnings reports.
A host of companies reporting this week include Alphabet and Tesla, along with IBM.
Investors also expect upbeat news for defence groups RTX, Lockheed Martin and General Dynamics. Ramped up government spending across the globe has seen the S&P 500 aerospace and defence sector rise 30 per cent this year.
In bond markets, US Treasury futures held steady having dipped late last week after Federal Reserve Governor Christopher Waller repeated his call for a rate cut this month.
Most of his colleagues, including Chair Jerome Powell, have argued a pause is warranted to judge the true inflationary impact of tariffs and markets imply almost no chance of a move in July. A September cut is put at 61 per cent, rising to 80 per cent for October.
Powell's reticence on rates has drawn the ire of Trump who threatened to fire the Fed chief, before backing down. The spectre of a potential political appointee who would seek to ease policy sharply has investors on edge.
The European Central Bank meets this week and is expected to hold its rates steady at 2.0 per cent following a string of cuts.
"The press conference will likely keep highlighting uncertainty and need to wait for tariff negotiations to conclude before deciding the next step," said analysts at TD Securities in a note. "Similarly, its 'meeting-by-meeting' language would be retained in the release."
The euro was unchanged at US$1.1630 in early trading, having dipped 0.5 per cent last week and away from its recent near-four-year top of US$1.1830. The dollar index was a fraction lower at 98.40.
In commodity markets, gold was little changed at US$3,348 an ounce with all the recent action in platinum which last week hit its highest since August 2014.
Oil prices were caught between the prospect of increased supply from OPEC+ and the risk European Union sanctions against Russia for its war in Ukraine could curb its exports.
Brent edged up 0.1 per cent to US$69.36 a barrel, while US crude added 0.1 per cent to US$67.39 per barrel. — Reuters
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Malay Mail
35 minutes ago
- Malay Mail
‘#Ishiba Don't quit': Unlikely support from opposition and public grows for Japan PM amid party revolt
TOKYO, July 26 — Japanese Prime Minister Shigeru Ishiba's future is uncertain but an unlikely campaign for him to stay was growing online this week, including from people who are his natural political opponents. The life raft has emerged since upper house elections on Sunday deprived Ishiba's coalition of an upper house majority, months after it suffered a similar disaster in the lower chamber. Despite Ishiba, 68, insisting that he has not discussed his resignation with members of his Liberal Democratic Party (LDP), multiple reports say that it is just a matter of time. Some conservative members of the LDP are collecting signatures to hold a special meeting to discuss a leadership election to oust Ishiba, Fuji TV reported yesterday. One reported signee is Sanae Takaichi, a hardline nationalist and onetime heavy metal drummer who lost a leadership contest to Ishiba in September. Takaichi, 64, would likely run again to lead the party — and become Japan's first woman prime minister if she wins — if Ishiba does depart. The prospect of someone as premier with hawkish views on Japanese history and China has fuelled online calls for the moderate Ishiba to remain in power under the hashtag '#Ishiba Don't quit'. Supporters of Japan's Prime Minister Shigeru Ishiba take part in a rally across the street from the prime minister's office in central Tokyo July 25, 2025. — AFP pic Some of the calls came from opposition politicians to the left of the LDP, including even from a Communist Party member of a local ward assembly. Ishiba 'is the most reasonable LDP leader in recent memory', LaSalle Ishii, a newly elected lawmaker for the Social Democratic Party, said on X. 'If he resigns, a far-right government will be born,' the well-known comedian and voice actor said. Taro Yamamoto, the leader of small opposition party Reiwa Shinsengumi, was among the first to voice concern about Ishiba's replacement. 'The question is, if he were not to continue, who is going to replace him instead?' he told reporters during a Monday news conference. 'His economic policies are no good, but for Ishiba-san to continue, I think it's a safe choice.' A few hundred people participated in a rally outside Ishiba's office Friday evening, with some holding up signs urging him to 'never give up' and 'persevere'. Among them was 70-year-old Shigeru Koga, an opposition supporter who until the election day on Sunday had been calling on Ishiba's government to be brought down. But five days later, he said Ishiba is 'still far better' than alternatives like Takaichi and Shinjiro Koizumi, the popular agriculture minister within LDP who Koga called 'easily manipulable'. 'If the Takaichi government materialises, it would further give rise to forces like far-right Sanseito,' Koga said, referring to the upstart 'Japanese first' party. 'To prevent that, and keep Japan safe, Ishiba must be brave and stand firm.' A supporter (centre right) of Japan's Prime Minister Shigeru Ishiba holds up a placard reading 'Don't quit Ishiba' as he takes part with others in a rally across the street from the prime minister's office in central Tokyo July 25, 2025. — AFP pic Boomeranging tariffs Shortly after the Sunday's election, a Kyodo News survey put the approval rating for the Ishiba government at just 22.9 per cent. But in that same poll, 45.8 per cent of the public believed there was no need for him to resign. The LDP has governed almost non-stop since 1955, but voters have been deserting the party, including towards fringe groups like Sanseito. Factors include rising prices, notably for rice, falling living standards, and anger at corruption scandals within the LDP. The opposition is seen as too fragmented to form an alternative government. But being in a minority in both houses of parliament means Ishiba's coalition needs support from other parties to pass legislation. This comes just as Japan faces multiple challenges, including a ballooning social security budget to pay pensions for its rapidly ageing and shrinking population. A new trade deal announced this week with US President Donald Trump will see Japanese imports face a painful 15 per cent tariff, although this was lower than a threatened 25 per cent. 'We'll evaluate it every quarter, and if the president is unhappy then they will boomerang back to the 25 per cent tariff rates,' US Treasury Secretary Scott Bessent said afterwards. — AFP


Malay Mail
an hour ago
- Malay Mail
Anwar reaffirms commitment to free speech after KL rally, urges dialogue beyond the streets
KUALA LUMPUR, July 26 — Prime Minister Datuk Seri Anwar Ibrahim has reiterated his administration's commitment to freedom of expression and peaceful assembly, following the 'Turun Anwar' rally in the capital that drew an estimated 18,000 participants. In a Facebook post today, he expressed gratitude to security and emergency personnel and called for continued democratic engagement beyond protests. 'I extend my utmost appreciation to all members of the security forces — from the police, fire department, medical teams, and volunteers — who have served with agility, discipline and high dedication,' Anwar said, crediting them for ensuring public safety and a smooth event. Addressing the crowd that had gathered, Anwar wished them safe journeys home and urged continued participation in national discourse. 'Criticism and differing views should not be seen through the lens of hostility,' he wrote. 'In fact, they must continue to flourish and thrive as the lifeblood of a mature, progressive and sovereign nation-state.' Anwar, who has long styled himself a reformist leader, said he remains 'steadfast and consistent' in upholding democratic principles, particularly the right to free speech and criticism. He also pointed to the Prime Minister's Question Time (PMQT) in Parliament as proof of his administration's openness to scrutiny. 'Members of Parliament are free to ask any question directly, and to raise objections to me as prime minister directly,' he said. 'I urge you to continue pressing MPs to attend and actively participate, especially in PMQT.' The prime minister went on to invite Malaysians to move beyond protest alone, encouraging them to 'engage in dialogue and discourse, find common ground, and chart and build this nation together.' He added, 'Not merely on the streets, but by rising to explore, master and seize new frontiers so that this country can be propelled forward with strength and vigour.' Ending his post on a forward-looking note, Anwar invited the public to return to Kuala Lumpur in the near future, highlighting upcoming restoration efforts at historic sites such as the Sultan Abdul Samad Building. 'These landmarks are undergoing large-scale conservation so we can boost tourism and support the economy in the capital, rich with historical value, hope, and national spirit, especially in conjunction with the upcoming Visit Malaysia Year 2026,' he said. The Facebook post comes after a peaceful rally earlier in the day, organised by Opposition figures, including former prime ministers Tun Dr Mahathir Mohamad and Tan Sri Muhyiddin Yassin, and civil society groups to protest against the rising cost of living and demand political accountability. Police said the event ended without incident.

Malay Mail
2 hours ago
- Malay Mail
Trump's ‘fake news' diversion tactics falter as Epstein uproar grows
WASHINGTON, July 26 — President Donald Trump's super powers as a public figure have long included the ability to redirect, evade and deny. But the Republican's well-worn methods of changing the subject when a tough topic stings politically are not working as his White House fends off persistent unrest from his usually loyal base about convicted sex offender Jeffrey Epstein and his associates. Trump has scolded reporters, claimed ignorance and offered distractions in an effort to quash questions about Epstein and the suspicions still swirling around the disgraced financier's case years after his 2019 death in prison. The demand for answers has only grown. 'For a president and an administration that's very good at controlling a narrative, this is one that's been harder,' said Republican strategist Erin Maguire, a former Trump campaign spokeswoman. Unlike political crises that dogged Trump's first term, including two impeachments and a probe into alleged campaign collusion with Russia, the people propelling the push for more transparency on Epstein have largely been his supporters, not his political foes. Trump has fed his base with conspiracy theories for years, including the false 'birther' claim that former President Barack Obama was not born in the United States. Trump's advisers fanned conspiracies about Epstein, too, only to declare them moot upon entering office. That has not gone over well with the president's right-leaning base, which has long believed the government was covering up Epstein's ties to the rich and powerful. 'Donald Trump's been running a Ponzi scheme based on propaganda for the better part of a decade and it's finally catching up to him,' said Geoff Duncan, a Republican former lieutenant governor of Georgia and Trump critic. 'The far right element is just dug in. They're hell bent on getting this information out.' The White House has dismissed reporting about Trump's ties to Epstein as 'fake news,' though it has acknowledged his name appears in documents related to the Epstein case. Trump and Epstein were friends for years before falling out. 'The only people who can't seem to shake this story from their one-track minds are the media and Democrats,' said White House spokesman Harrison Fields. Before leaving for a trip to Scotland yesterday, the president again urged people to turn their attention elsewhere. 'People should really focus on how well the country is doing,' Trump told reporters, lamenting that scrutiny was not being given to others in Epstein's orbit. 'They don't talk about them, they talk about me. I have nothing to do with the guy.' A person takes a photo as a message calling on President Donald Trump to release all files related to Jeffrey Epstein is projected onto the US Chamber of Commerce building across from the White House in Washington, DC July 18, 2025. — AFP pic The art of distraction Trump in recent weeks has employed a typical diversion playbook. He chastised a reporter for asking about Epstein in the White House Cabinet Room. He claimed in the Oval Office that he was not paying close attention to the issue. And, with help from Tulsi Gabbard, his director of national intelligence, he explosively accused Obama of treason for how he treated intelligence in 2016 about Russian interference in the US election. On Thursday, Trump took his distraction tour to the Federal Reserve, where he tussled with Chair Jerome Powell about construction costs and pressed for lower interest rates. That, said Republican strategist Brad Todd, was more effective than focusing on Obama in 2016, which voters had already litigated by putting Trump back in office. 'The Tulsi Gabbard look backward, I think, is not the way for them to pivot,' Todd said, noting that Trump's trip to the Fed highlighted the issue of economic affordability and taking on a Washington institution. 'If I was him I'd go to the Fed every day until rates are cut.' Democrats have seized on Trump's efforts to move on, sensing a political weakness for the president and divisions in the Republican Party that they can exploit while their own political stock is low in the wake of last year's drubbing at the polls. A Reuters/Ipsos poll this month showed most Americans think Trump's administration is hiding information about Epstein, creating an opportunity for Democrats to press. Trump's supporters and many Democrats are eager to see a release of government files related to Epstein and his case, which the Justice Department initially promised to deliver. 'Yesterday was another example of the Trump folks trying to throw as much stuff against the wall to avoid the Epstein files,' Mark Warner, a Democratic US senator from Virginia, said in a post on X on Thursday about Gabbard's accusations against Obama. Trump allies see the administration's efforts to change topic as a normal part of an all-out-there strategy. 'They are always going at 100 miles an hour. Every department, every cabinet secretary, everybody is out there at full speed blanketing the area with news,' Republican strategist Maguire said. Trump has weathered tougher periods before, and his conservative base, despite its frustration over the files, is largely pleased with Trump's work on immigration and the economy. In a July Reuters/Ipsos poll, 56 per cent of Republican respondents favoured the administration's immigration workplace raids, while 24 per cent were opposed and 20 per cent unsure. Pollster Frank Luntz noted that Trump had faced felony convictions and other criminal charges but still won re-election last year. 'We've been in this very same situation several times before and he has escaped every time,' Luntz said. — Reuters