{"id":65377,"date":"2026-07-24T23:38:26","date_gmt":"2026-07-25T03:38:26","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/"},"modified":"2026-07-24T23:38:26","modified_gmt":"2026-07-25T03:38:26","slug":"global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/","title":{"rendered":"Global Markets &#038; Geopolitics: Japan\u2019s Political Shift, U.S. Tech Tensions, and New Trade Hurdles in the Strait of Hormuz"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#Key_Takeaways\" >Key Takeaways<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#Japans_Political_and_Administrative_Transformation\" >Japan\u2019s Political and Administrative Transformation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#Geopolitical_Friction_in_the_Strait_of_Hormuz\" >Geopolitical Friction in the Strait of Hormuz<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#The_Semiconductor_and_AI_Tug-of-War\" >The Semiconductor and AI Tug-of-War<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#Defense_and_Automotive_Market_Shifts\" >Defense and Automotive Market Shifts<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-geopolitics-japans-political-shift-u-s-tech-tensions-and-new-trade-hurdles-in-the-strait-of-hormuz\/65377\/#Currency_Outlook_EURJPY\" >Currency Outlook: EUR\/JPY<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"Key_Takeaways\"><\/span>Key Takeaways<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li><strong>Japan enacts historic &quot;2nd Capital&quot; legislation<\/strong> to establish a backup for Tokyo in emergencies, as Prime Minister <strong>Sanae Takaichi<\/strong> prepares a major Cabinet reshuffle following the end of the 2026 Diet session.<\/li>\n<li><strong>U.N. agency head warns that proposed transit fees<\/strong> in the <strong>Strait of Hormuz<\/strong> by both the <strong>U.S.<\/strong> and <strong>Iran<\/strong> defy international law, threatening global shipping stability and freedom of navigation.<\/li>\n<li><strong>Apple (<a href=\"\/stock\/AAPL\">AAPL<\/a>) and <a href=\"https:\/\/stockmarketwatch.com\/stock\/MU\" data-internallinksmanager029f6b8e52c=\"20\" title=\"Stock: MU\">Micron<\/a> (<a href=\"\/stock\/MU\">MU<\/a>) clash<\/strong> over a proposal to use blacklisted Chinese memory chips, placing the <strong>Trump administration<\/strong> at the center of a high-stakes trade and national security dilemma.<\/li>\n<li><strong>Ukraine seeks licensed production of Patriot systems<\/strong> in Japan, specifically targeting a partnership with Mitsubishi Heavy Industries (<a href=\"\/stock\/MHVYF\">MHVYF<\/a>) to bolster its domestic anti-ballistic missile capabilities.<\/li>\n<li><strong>Hongqi overtakes Rolls-Royce<\/strong> (BMW (<a href=\"\/stock\/BMWYY\">BMWYY<\/a>)) in China&#39;s ultra-luxury sedan market, signaling a significant shift in consumer preference toward domestic prestige brands.<\/li>\n<\/ul>\n<hr>\n<h2><span class=\"ez-toc-section\" id=\"Japans_Political_and_Administrative_Transformation\"><\/span>Japan\u2019s Political and Administrative Transformation<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Japanese Prime Minister <strong>Sanae Takaichi<\/strong> is reportedly weighing a significant reshuffle of her Cabinet and ruling Liberal Democratic Party (LDP) executives. The move, expected in August or September, aims to revitalize her administration&#39;s image amid declining approval ratings. Observers are closely watching whether rivals such as Defense Minister <strong>Shinjiro Koizumi<\/strong> will retain their posts.<\/p>\n<p>Simultaneously, the Japanese Diet has officially passed the <strong>&quot;2nd Capital&quot; bill<\/strong> as the 2026 main session concludes. This landmark legislation authorizes the creation of a secondary administrative hub\u2014likely centered in <strong>Osaka<\/strong>\u2014to serve as a backup for Tokyo in the event of a catastrophic natural disaster. The bill&#39;s passage was a key condition of the LDP\u2019s coalition deal with the <strong>Japan Innovation Party<\/strong>.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Geopolitical_Friction_in_the_Strait_of_Hormuz\"><\/span>Geopolitical Friction in the Strait of Hormuz<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The head of a <strong>U.N. agency<\/strong> has declared that proposed shipping fees for the <strong>Strait of Hormuz<\/strong> violate international law. The controversy follows a proposal by the <strong>Trump administration<\/strong> to impose a <strong>20% fee<\/strong> on cargo to offset security costs, which was met by a counter-demand from <strong>Iran<\/strong> to collect its own tolls.<\/p>\n<p>The <strong>International Maritime Organization (IMO)<\/strong> reaffirmed that there is no legal basis for mandatory tolls in international straits. <em>Market analysts warn that any attempt to enforce these fees could lead to a naval blockade or significant spikes in global energy and insurance costs.<\/em><\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_Semiconductor_and_AI_Tug-of-War\"><\/span>The Semiconductor and AI Tug-of-War<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>A major conflict has emerged between <strong>Apple (<a href=\"\/stock\/AAPL\">AAPL<\/a>)<\/strong> and <strong>Micron (<a href=\"\/stock\/MU\">MU<\/a>)<\/strong> regarding the use of Chinese semiconductors. <strong>Apple<\/strong> has reportedly lobbied the <strong>Trump administration<\/strong> for permission to source memory chips from <strong>ChangXin Memory Technologies (CXMT)<\/strong> and <strong>Yangtze Memory Technologies (YMTC)<\/strong> for its Chinese market products. <strong>Micron<\/strong> is vigorously opposing the move, citing national security risks and the potential for Chinese state-backed firms to undercut American manufacturers.<\/p>\n<p>In response to these global dependencies, <strong>Japan<\/strong> is actively seeking international AI partnerships beyond the <strong>U.S.<\/strong> and <strong>China<\/strong>. Tokyo recently joined the <strong>&quot;Genesis Mission,&quot;<\/strong> a <strong>$1 billion<\/strong> joint AI project with Washington, but remains committed to diversifying its tech alliances to ensure long-term strategic autonomy.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Defense_and_Automotive_Market_Shifts\"><\/span>Defense and Automotive Market Shifts<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><strong>Ukraine<\/strong> has formally called for Japanese support to begin licensed production of the <strong>Patriot<\/strong> missile system. President <strong>Volodymyr Zelenskyy<\/strong> highlighted <strong>Mitsubishi Heavy Industries (<a href=\"\/stock\/MHVYF\">MHVYF<\/a>)<\/strong> as a premier candidate for co-production, following a tentative licensing approval from the <strong>U.S.<\/strong> This development tests Japan&#39;s evolving policies on the export of lethal defense equipment.<\/p>\n<p>In the luxury sector, the Chinese state-owned brand <strong>Hongqi<\/strong> has reportedly surpassed <strong>Rolls-Royce<\/strong> in ultra-luxury sedan sales within China. The success of the <strong>Hongqi Golden Phoenix<\/strong> model indicates a &quot;nationalistic luxury&quot; trend among China&#39;s elite, challenging the long-standing dominance of European marques like <strong>BMW (<a href=\"\/stock\/BMWYY\">BMWYY<\/a>)<\/strong>.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Currency_Outlook_EURJPY\"><\/span>Currency Outlook: EUR\/JPY<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The <strong>EUR\/JPY<\/strong> cross is currently consolidating below the <strong>187.00<\/strong> level. <em>Technical analysts suggest that bulls are targeting the <strong>188.00<\/strong> psychological barrier, supported by ongoing divergence between European Central Bank policy and the Bank of Japan&#39;s cautious normalization path.<\/em> However, political uncertainty in Tokyo could introduce near-term volatility to the pair.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Japan enacts historic &quot;2nd Capital&quot; legislation to establish a backup for Tokyo in emergencies, as Prime Minister Sanae 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