In the July 11 House of Councilors election, the main opposition force -- the Democratic Party of Japan -- made big gains while the leader of the ruling coalition -- the Liberal Democratic Party -- fell short of its modest target of a one-seat gain. Nevertheless, the LDP-led coalition government still has a comfortable majority in the upper chamber (only half of the seats were up for grabs), and the results are not expected to create serious political turmoil.
The LDP was criticized for lawmakers who failed to make mandatory payments into the national pension scheme and the government's deployment of the Self-Defense Forces to Iraq, but its economic policies weren't among the key campaign issues.
Instead, pre-election media surveys had forecasted losses for the LDP, creating anxiety about the future of the nation's economic management and triggering falls in share prices. But when Prime Minister Junichiro Koizumi emerged from the election aftermath and confirmed he would "maintain" his structural reform initiatives, those concerns dissipated and share prices turned up.