Japan is facing some political uncertainty, after snap elections saw the ruling LDP/Komeito coalition lose its lower house majority. The election result does make governance more challenging for the lshiba administration, who will likely have to expand their coalition to include other parties to remain in power. Political fragmentation amongst multiple parties in a coalition government complicates policy rollout, resulting in more controversial legislation being harder to pass. Any attempts to restore the LDP's popular support will likely focus on fiscal policy to improve the party's public image following a fundraising scandal. Despite the election outcome, the Japanese equity market outlook still remains positive given the return of reflation via wage growth and the ongoing corporate governance reforms. The economic outlook in the U.S. and USD/JPY remain crucial for Japan equities. A soft landing in the U.S. could sustain a weak yen and boost stocks, while a hard landing could strengthen the yen and pressure equities.