9/4/21 Japan Galaxy News: Japan PM Suga Decides To Step Down, Nikkei Rises; Putin Stresses Need For Peace Treaty With Japan
1. Japan PM Suga decides to step down, Nikkei rises
Japanese Prime Minister Yoshihide Suga said Friday he will not run for the ruling party’s leadership in September and will step down, setting the stage for his successor after just one year in office, BUSSINESS reported Sept. 3. Japan’s Topix stock index rose 1.6 percent to a 30-year high in afternoon trading after the news, with the Nikkei jumping about 1.8 percent. The yen was moving higher to 110.025 yen per dollar. I think we may be back to Japanese politics before Shinzo Abe,” said Nomura, co-head of Asian equity research. If you look at post-war Japanese politics, the average tenure of a prime minister has been well under four years. We know that the LDP has had a solid position without any credible opposition from a stock market perspective. There is a fair amount of certainty around issues like corporate tax or anything that might affect the stock price. “
2. Japan’s Service Sector Activity Shrinks at Fastest Pace Since May 2020 in August
Japan’s service sector activity contracted at the fastest pace in more than a year in August as the resurgence of the epidemic dealt a blow to the recovery in the world’s third-largest economy, XM reported on Sept. 3. New business inflows shrank at the fastest pace since May last year, and the expansion of the Communist virus hit companies. As a result, Japan’s services purchasing managers’ index (PMI) plunged to a seasonally adjusted 42.9 from 4In addition, in July. The surge in the delta variant of the virus forced the Japanese government to extend emergency containment measures to more prefectures in August, even as many people defied orders to stay home and avoid crowded places, hurting business activity.
3. Putin Stresses Need for Peace Treaty with Japan
Russian President Vladimir Putin said the status quo of no peace treaty between Japan and Russia is “unreasonable” and stressed the need for a treaty, Kyodo News reported on Sept. 3. He expressed concern over the activities of U.S. military forces within Japan’s borders near Russia and the possibility of deploying missile attack systems. He also said he asked Japan to “guarantee future peace” while the treaty is being negotiated. Putin also clarified that the clause prohibiting territorial cessions, included in last year’s constitutional revision, does not affect treaty-oriented initiatives. On the other hand, regarding the special customs-free zone to be set up on the four northern islands under Russia’s de facto control, Putin said that investment companies would be exempted from various other taxes for 10 years. He noted that foreign investors, including Japan, will also benefit.
4. German Government Designates Japan as a “High-Risk Area”
The Embassy of Japan in Germany announced on its website on September 3 that “the German government has designated Japan as a ‘high-risk area’ (Hochrisikogebiet),” according to a report by Sporting News Know on September 4. As a result, Japan will no longer be included in the list of countries designated by the German government to remove entry restrictions, and travelers from Japan, especially short-term visitors, will again be restricted from entering the country from midnight on September 5, 2021. In addition, if a vaccination certificate or a certificate of convalescence is submitted via the Digital Entry Register (DEA), it is possible, i.e., no quarantine is required”.
5.Tokyo Stock Exchange to Achieve 30-Minute Extension of Trading Hours within Three Years
The Tokyo Stock Exchange (TSE) is finalizing a plan to extend daily trading hours from 9 a.m. to 3 p.m. (excluding lunch breaks) to 3:30 p.m. to make it more convenient for investors, NHK reported on Sept. 3. By extending trading hours by 30 minutes, the TSE hopes to attract investment to the Tokyo market, where the market capitalization of listed companies has been depressed for the past decade compared with the stock markets in New York and Shanghai. In addition, the Tokyo Stock Exchange experienced a system failure last October that halted trading throughout the day but extending trading hours will make it easier to ensure that trading can continue once the system is restored, thus reducing the impact on investors.
6. Nissan Develops Rare Earth Recycling Technology
Nissan Motor Co. announced that it has developed a technology in collaboration with Waseda University to effectively recover rare earths from magnets used in electric motors, a scarce resource whose demand will grow with the electrification of cars, by melting down the motors in cars, NHK reported Sept. 3. Rare earths are necessary to produce the magnets that help rotate the motors in electric and hybrid vehicles, and demand for rare earths is expected to increase as cars become more electric.
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