Markets Today: Japan PM Resigns, Gold Above $3600/oz, China Exports Miss Forecasts, FTSE 100 Holds at Support

[Ben Graham]

Asia Market Wrap - Japan PM Ishiba Resigns

Most Read: GBP/USD Forecast: Cable Recovers but the Outlook Remains Murky. WIll NFP Data Serve as a Catalyst?

Following weeks of public pressure due to his party's second national election loss, Japanese Prime Minister Ishiba has announced his resignation. This has triggered a leadership contest that may cause market instability.

The Topix, jumped 1.3% to a new all-time high of 3,146.58. The Nikkei 225 index, which tracks top Japanese companies, also rose by 1.45% to 43,643.81, which is close to its own record. The value of the yen dropped by 0.4% against the U.S. dollar, with one dollar now worth 148 yen.

Japanese government bond prices were initially stable but fell later in the day, causing their yields (the return for investors) to increase. The yield on 20-year bonds went up by 3.5 basis points to 2.67%, and the yield on 30-year bonds rose by 6 basis points to 3.285%, which is the highest it has ever been.

Yields on long-term Japanese bonds have been rising recently because of international worries about government debt and due to the internal pressure on Prime Minister Ishiba from his party, the Liberal Democratic Party (LDP). At the same time, the Nikkei stock index recently dropped from its record high last month.

Source: LSEG

A leading candidate to replace Ishiba as head of the LDP is Sanae Takaichi. She is a supporter of "Abenomics," the economic policies of former Prime Minister Shinzo Abe, who was known for large-scale government spending and a very loose monetary policy.

On the Nikkei index, more stocks rose than fell, with 197 advancing and only 26 declining. The biggest winners were the chip design company Socionext, which saw its stock price increase by 8%, and Mazda Motor Corp, which jumped by 7.2%. Mitsubishi Heavy Industries, a company poised to gain from any increase in defense spending, also surged 3.3%.

Additionally, two major players in the Japanese artificial intelligence (AI) sector, Advantest and SoftBank Group, saw their shares rise by 4.4% and 2.1%, respectively.

China Exports Hit 6-Month Low

In August 2025, China's exports grew by 4.4% compared to the same month last year, totaling $321.8 billion. This was a slower rate than the 7.2% growth in July and was below the expected 5% increase. The slowdown, which made this the weakest month for exports since February, was primarily caused by a temporary decrease in tariff tensions and a drop in demand from China's main consumer, the United States.

On August 11, China and the U.S. extended their tariff agreement for 90 days, which kept existing tariffs in place. While exports to Japan, Taiwan, Australia, ASEAN, and the EU all grew significantly, exports to the U.S. plummeted by 33.1% and those to South Korea fell by 1.4%. Over the first eight months of 2025, China's total exports increased by 5.9% to $2.45 trillion, with notable growth in specific categories such as fertilizer, ships, and cars.

European Open - French No-Confidence Vote in Focus

European stock markets had a good start on Monday as a week of significant events began. The main story is the political uncertainty in France, which is likely to need a new prime minister for the fifth time in three years.

The current French Prime Minister, Francois Bayrou, is expected to lose a no-confidence vote today. This is happening while the country, Europe's second-largest economy, is trying to manage its large national debt. France is also facing its first of several credit rating reviews this week, which could affect how lenders view its ability to repay its loans.

The overall European stock market index, the STOXX 600, went up by 0.33%, while France's main index, the CAC 40, rose by 0.4%.

Despite these early gains, French stocks have not performed as well as the broader European market this year. This is due to investor worries about government spending and debt, which have caused long-term bond yields (the return on an investment in bonds) to reach their highest levels in several years.

In other company news, the investment bank Goldman Sachs downgraded its rating on the airline RyanAir, causing its shares to drop by 2%. On the other hand, shares of the retailer Marks and Spencer increased by 2.2% after the brokerage firm Citi upgraded its rating on the company to "buy."

Additionally, shares of the Dutch company ASML went up by 0.7% after a news report stated that the company is set to become the largest owner of the French artificial intelligence startup, Mistral AI.

On the FX front, The Japanese yen dropped significantly in value during trading in Asia. At one point, the U.S. dollar gained as much as 0.78% against the yen before settling down to a 0.1% increase for the day, with one dollar trading at 147.625 yen.

Similarly, the yen fell to its lowest value in over a year against both the euro and the British pound. A single euro was worth 173.13 yen, and one pound was worth 199.53 yen.

The British pound slightly rose by 0.1% to $1.352, building on its more than 0.5% gain from Friday. The euro remained steady at $1.1727 after reaching a high not seen in over a month on Friday.

The U.S. dollar index, which measures the dollar's value against a group of other major currencies, slightly decreased by 0.2% to 97.7, following a more than 0.5% drop on Friday.

Currency Power Balance

Source: OANDA Labs

Oil prices went up by more than $1 on Monday, recovering some of the value they lost last week. This was partly due to the possibility of new sanctions on Russian oil following an attack on Ukraine.

OPEC+, a group of major oil producers, announced it would slightly increase production starting in October, but the amount was small.

Brent crude oil rose by $1.24 (1.9%) to $66.74 per barrel. At the same time, U.S. West Texas Intermediate crude oil increased by $1.17 (1.9%) to $63.04 per barrel.

Gold prices remained strong near their all-time high on Monday, getting closer to the key level of $3,600 per ounce. This was supported by growing expectations that the U.S. Federal Reserve will cut interest rates this month, especially after a weaker-than-expected jobs report was released last week.

The price of spot gold was up 0.2% at $3,593.79 per ounce. On Friday, gold had already reached a record high of $3,599.89.

Economic Data Releases and Final Thoughts

Looking at the economic calendar, the European session will be quiet with Sentix investor confidence data the main release to focus on.

The US session will also seem to be a quiet one, with the main area of focus being NY Fed inflation expectations.

The week will get busy from Wednesday onward with a host of high impact data releases with the US particularly in focus.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Chart of the Day - FTSE Index

From a technical standpoint, the FTSE 100 continues to hold above the 100-day MA following a trendline break last week.

The trendline break still hints at further upside with the RSI period-14 hovering above the neutral 50 level.

If the neutral 50 level holds this would be another sign that bullish momentum remains dominant.

This could see the FTSE continue its move higher toward the all-time highs.

Immediate resistance rests at 9250, 9271 and 9308.

Immediate support may be found at 9219, 9180 and 9128.

FTSE 100 Four-Hour Chart, September 9. 2025

Source: TradingView.com (click to enlarge)

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