Japan’s Prime Minister Sanae Takaichi may struggle to soothe voters and markets

Japan's Prime Minister Sanae Takaichi faces challenges in balancing voter satisfaction and market stability after her election win.

Japanese stocks soared to record highs on Monday (February 9, 2026) after Prime Minister Sanae Takaichi’s election triumph, but experts warned that the country’s first woman leader could struggle to keep both voters and markets happy.

In its best result since its founding in 1955, Ms. Takaichi’s conservative Liberal Democratic Party won a two-thirds majority in Sunday’s (February 8) snap lower house election, according to Japanese media.

With the result, Ms. Takaichi, 64, managed to capitalise on her strong popularity since taking the helm of a moribund LDP in October and becoming Japan’s fifth premier in five years.

On Monday (February 9) the Nikkei 225 briefly jumped more than 5% to pass 57,000 points for the first time, while the yen strengthened against the dollar.

Analyst Kyle Rodda of Capital.com said the victory handed Ms. Takaichi “the mandate she was looking for for her big-spending agenda”.

Equities are “poised to benefit from higher fiscal spending but interest rates that remain accommodative and negative in real terms”, he said.