Tokyo investors eye Japan growth figures next week

[TOKYO] Tokyo investors will focus their attention on fourth-quarter Japanese growth figures next week, with economists widely expecting that the country crawled out of recession during the last three months of 2014.

Japan's economy contracted for the second straight quarter between July and September as consumer spending dropped sharply following an April sales tax rise aimed at shrinking a massive national debt.

But with signs of a recovery - including an uptick in factory output and a tight labour market - economists surveyed by the leading Nikkei business newspaper estimated gross domestic product expanded by an average 0.9 per cent in October-December. The figures are due Monday.

"We are paying close attention to the GDP numbers - good figures would be a buying cue," said Toshikazu Horiuchi, a broker at IwaiCosmo Securities.

Investors will also keep a close eye on talks aimed at hammering out a deal between debt-hit Greece and its international creditors.

Global markets are hoping an agreement can be reached before the end of the month, when Greece's bailout is due to expire. Failure to agree an extension would see it default on its giant debts and could mean it would crash out of the eurozone.

Confidence is broadly high after Ukraine, Russia, France and Germany on Thursday hammered out a blueprint to end the conflict between Kiev and pro-Moscow rebels.

The ceasefire is to take effect at midnight Sunday (2200 GMT Saturday) in Ukraine and heavy weapons are to be withdrawn from front lines.

However, Horiuchi warned: "These two issues - the Ukraine ceasefire and Greek crisis - may not be resolved immediately, which will create uncertainty in the market." On Friday, Tokyo's benchmark Nikkei 225 index, which hit a more thsn seven-year high Thursday, slipped owing to a stronger yen.

The headline index slipped 0.37 per cent, or 66.36 points, to close at 17,913.36, although it added 1.50 per cent over the week.

The broader Topix index of all first-section shares was flat, edging down 0.01 points to 1,449.38.

It added 2.27 per cent over the shortened week, with Japanese markets closed Wednesday for national holiday.

Toyota slipped 0.54 per cent to 7,808.0 yen on Friday, Sony edged down 0.34 per cent to 3,220.5 yen and camera giant Canon fell 0.58 per cent to 3,812.5 yen.

The dollar bought 118.54 yen, down from 118.97 yen in New York and well off 120.27 yen in Tokyo earlier Thursday.

AFP