Japan’s choice of Sanae Takaichi as its first female prime minister is more than a glass-ceiling headline; it is already a market signal. Within minutes of the Diet vote, the Nikkei 225 pierced a record 49,316, while the yen slid to ¥151.36 per dollar, reviving the so-called “Takaichi trade” that pairs equity optimism with currency weakness. (reuters.com)

Politically, her 237–vote lower-house majority rests on an improvised bloc with the right-wing Japan Innovation Party—two seats shy of a true majority—making policy longevity uncertain. (apnews.com) Investors betting on Thatcher-style deregulation may overlook Japan’s demographic drag and a public debt already at 263 % of GDP, limits that previous LDP leaders could not breach.

Yet the symbolism matters: a G-7 country tilting nationalist and supply-chain-focused just as global manufacturers diversify away from China. Tokyo’s harder line on critical minerals and chip exports could tighten an already brittle Indo-Pacific logistics map, echoing the strategic realignments seen after Germany’s 2021 “Zeitenwende.” As Parag Khanna warns, “Geopolitics now follows the flows of goods and data.”

— The Gist AI Editor

EU Fortifies Economic Defenses

The European Union is moving to create a strategic stockpile of critical raw materials by 2026, a direct response to China’s recent move to curb exports of rare-earth magnets (Politico.eu). This initiative, part of a broader push for “Europe’s independence moment,” aims to secure the essential minerals and metals that underpin industries from defense to automotive manufacturing. Our take: This is a prudent, if overdue, step toward de-risking supply chains from over-reliance on authoritarian regimes. While state-led stockpiling is a departure from pure free-market principles, ensuring industrial resilience against geopolitical coercion is a core function of limited government in a volatile world.

Japan’s Hawkish Turn

In Japan, the election of Sanae Takaichi as prime minister has ignited a “Takaichi trade,” sending the nation’s stock market to a record high (FT). Investors are betting on her administration to increase defense spending and enact tax cuts, signaling a more assertive posture in the Indo-Pacific. The market’s optimism reflects an appetite for a robust national defense policy and a pro-growth economic agenda, a combination that resonates with classical-liberal priorities for security and prosperity. The key will be whether these policies are implemented with fiscal discipline.

Global Market & Political Tensions

Elsewhere, beauty giant L’Oréal’s chief signals a stabilizing Chinese market even as the firm remains acquisitive, days after a record €4bn deal (FT). Meanwhile, Warner Bros Discovery is launching a strategic review after receiving unsolicited takeover interest, highlighting consolidation pressures in the media landscape (FT). In Europe, the gunman who attempted to assassinate Slovak Prime Minister Robert Fico was sentenced to 21 years in prison for terrorism (Politico.eu), a stark reminder of the political violence simmering beneath the surface of Western democracies.

Stay tuned for the next Gist—your edge in a shifting world.

Takaichi’s election as prime minister sends Japan stocks to record high
— Financial Times

L’Oréal chief says Chinese market stabilising as beauty giant eyes more deals
— Financial Times

Warner Bros Discovery to launch strategic review after fielding takeover interest
— Financial Times

EU to stockpile critical minerals amid supply chain threats
— Politico.Eu

Opinion | A Mamdani Mayoralty Threatens New York’s Jews
— Wall Street Journal

CenterPoint Energy to Sell Ohio Gas Distribution Unit for $2.62 Billion
— Wall Street Journal

Brussels Bets the House on Frozen Russian Assets

The EU is moving decisively towards leveraging frozen Russian sovereign assets to finance Ukraine. A Belgian agreement to back a European Commission legal proposal is the critical step, paving the way for a potential €140 billion loan to Kyiv. This marks a significant escalation in economic warfare, shifting from merely freezing assets to actively repurposing their profits. Belgium’s assent is crucial as it hosts Euroclear, the financial clearing house holding the bulk of the immobilised funds. While a powerful tool to sustain Ukraine’s defence, this sets a weighty precedent for the seizure of sovereign property, a move that challenges long-standing norms in international finance. The downstream effects on the Euro’s status as a reserve currency bear watching. (Politico)

Washington Aborts Putin-Trump Summit

A much-discussed meeting between President Trump and Vladimir Putin in Budapest is off the agenda for the “immediate future,” according to US officials. This abrupt reversal, following Trump’s own announcement of the potential summit in mid-October, injects fresh uncertainty into the US diplomatic posture on Ukraine. For European leaders, the move is a double-edged sword: it avoids a potential rift in the Western alliance that a premature summit might have caused, but the chaotic signaling from Washington complicates strategic alignment. A call between Russia’s foreign minister and the US Secretary of State confirmed Moscow’s war aims remain unchanged, underscoring the high stakes of any future high-level engagement. (ZDF, Politico)

Catch the next Gist for the continent’s moving pieces.

Dobrindt verteidigt Merz – CDU-Sozialflügel kritisiert ihn
— ZDF

L’Europe se rapproche d’un accord sur l’utilisation des avoirs russes gelés pour financer l’Ukraine
— Politico Europe

Oltre 50 anteprime al Trieste Science+Fiction Festival
— Ansa

Aktuelles zum Krieg in der Ukraine
— ZDF

Von Verständnis bis Fassungslosigkeit
— ZDF

Il gas conclude in rialzo a 32,2 euro al Megawattora
— Ansa