After a slump in global stocks last week, data from Japan and China will likely top traders’ watchlist this week as they seek more cues on the state of the global economy. Beyond Asia, investors will watch the Federal Reserve’s policy meeting for any indication when it will begin to raise interest rates.
Over the weekend, Prime Minister Shinzo Abe won his snap election and his ruling Liberal Democratic Party (LDP) and coalition partner maintained a supermajority, according to media exit polls. Abe’s decision to call for a snap election two years early is seen as a referendum not only on his decision to delay a sales tax increase but on Abenomics as a whole.
On Monday, the Bank of Japan’s Tankan survey of the corporate sector is expected to show little improvement in sentiment among big manufacturers and possibly a worsening among smaller companies. The headline index for big manufacturers’ sentiment likely rose to plus 13, unchanged from the previous quarter.