Japan in focus: Coalition wins Lower House elections

•     Japan in focus:  Coalition wins Lower House elections

–    Ruling LDP loses only a few seats in election, coalition partner gains, net +1

–    Victory should strengthen Abe’s hand in promoting economic reforms = good for Japanese stocks, good for USD/JPY (i.e., yen to weaken)

•     But disappointing tankan takes center stage

–    Major indices came in lower than expected & fell from previous month

–    Falling expectations disappointed stock market; USD/JPY at Friday’s opening level

•     Oil falls after UAE minister says OPEC won’t cut output even at $40

•     Commodity currencies under pressure from falling oil

–    AUD additionally hit by widening budget deficit as iron ore prices slump

•     Today: US: Industrial output for Nov expected +0.7%, NAHB index to rise = USD-positive

•     This week:

–    Globally:  Preliminary Dec manufacturing PMIs on Tuesday

–    US: FOMC meeting Wednesday: Will they remove “considerable time”?

–    Eurozone: ZEW Tuesday, Ifo survey Thursday

–    Japan:  BoJ meeting Friday not expected to make changes

–    UK:  BoE minutes and labor market data Wednesday