The loss seems to have been over the proposed sales tax increase, which would have been a strong negative for GDP, so this result is equity friendly:

“Public support for the DPJ rebounded when Kan took, but tumbled quickly after he floated a rise in the sales tax from 5 percent to help rein in debt.”

“Critics blame Kan’s eagerness to hike the rate for causing the DPJ’s major defeat in Sunday’s Upper House election.”

Japan Headlines:

DPJ Suffers Crushing Defeat; LDP Wins Most Seats

Corp Goods Prices Up 0.5% On Year In June

Japan’s used vehicle sales in Jan.-June fall to 2nd-lowest level

IMF Shinohara: Japan Must Be Cautious Discussing Taxes; No Sharp Yuan Rise

Edano: Won’t Rigidly Stick To Drafting Sales Tax Hike This Fiscal Year

LEAD: Tokyo stocks edge lower as post-election uncertainty weighs+