Japanese stocks slipped on Friday as investors closed positions as the year-end approaches, but the sentiment remained upbeat about the prospects for 2015.

With overseas markets closed on Thursday for Christmas, there was little in the way of market catalysts.

The Nikkei benchmark fell 0.1 per cent to 17,784.04 by 0105 GMT, after notching its first drop in six sessions on Thursday.

Investors remained bullish on the performance of Japanese equities in the new year, expecting the average to exceed a 14-1/2 year high of 18,300.39.

“Investors don’t mind a small drop of the last couple of days as there’s fresh hopes for a rally next year,’’ said Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management.

Leading exporters’ shares were steady as the yen traded at around 120.25 against the dollar. The weak yen boosts Japanese exporters’ profits and may make firms more competitive.

Japan’s largest automaker Toyota Motor Corp added 0.4 per cent, while Panasonic Corp slipped 0.2 per cent.

Large-cap firms were mixed, with mobile phone giant Softbank Corp ticking up 0.3 per cent and Uniqlo clothes brand owner Fast Retailing Co Ltd losing 0.7 per cent.

Japan’s consumer inflation

But highlighting the challenges for Japan’s economy in 2015, Japan’s annual core consumer inflation slowed for a fourth consecutive month in November, data showed.

Pressured by plummeting oil prices, the consumer core price index rose at an annual rate of 2.7 per cent last month.

Excluding April’s 3 percentage point sales tax hike, the figure was 0.7 per cent, underlining the difficulty of the Bank of Japan’s uphill push to achieve 2 percent inflation.

Household spending remained weak, separate data showed, given slow wages growth. Rising wages are crucial to the success of Prime Minister Shinzo Abe’s reflationary policies. Stagnant wages will mean any recovery from recession is likely to be fragile.

Also in focus were initial public offering plans for Japan Post Holdings Co, one of the world’s biggest financial institutions.

Japan Post Holdings is expected to list its bank and insurance units separately in the IPO in Sept. 2015, sources familiar with the matter told Reuters this week. A briefing is scheduled at 0700 GMT. The broader Topix added 0.1 per cent to 1,422.39, while the JPX-Nikkei Index 400 was flat at 12,923.88.

Related Topics
comment COMMENT NOW