TOKYO MARKET: Exporters expected to fall amid rate fears

Japanese Stocks may fall this week, led by exporters, amid concern that a possible rise in US interest rates may hurt consumer sentiment.

Canon and Sony may also come under pressure from the currency market, where the yen rose against the dollar on Friday following the government's unexpected revision higher of first-quarter gross domestic product figures.

"Concern about the currency and Wall Street will still weigh on the market," said Toshio Tahara, a general fund manager at Sumisei Global Investment Trust Management Co. "Yet, with many investors away on vacation, I expect the downside risk to be limited."

Last week, the Nikkei 225 index rose 350.93, or 2 per cent, to 17,435.17 points, rebounding from the worst week this year, when it fell 4.3 per cent between 2 August and 6 August. The Topix index fell 21.81, or 1.5 per cent, to 1,442.49 points.

Investors will watch for signs of inflation in the US when the July consumer price index is released on Tuesday. If the numbers are strong, concern that the Federal Reserve Bank will raise interest rates when it meets on 24 August will keep investors away from exporters whose earnings will be hurt by weaker consumer demand.

Canon, Japan's largest maker of office equipment, exports 83 per cent of its products, while Sony, Japan's second-largest consumer electronics company, exports 68 per cent of its goods.

Investors may also get a cue to sell exporters from the currency market, where the yen could rise further amid signs Japan's economy is getting back on track.

Figures released in Tokyo on Friday indicated that Japan's economy expanded a revised 2 per cent in the January-March quarter, up from an initial estimate of 1.9 per cent. Many traders were expecting the number to be adjusted lower, as the original estimate, released two months ago, surpassed economists' forecast of a 0.1 per cent expansion.

Japanese bonds are likely to fall this week as further signs of economic recovery may increase expectations that the central bank will allow overnight interest rates to rise earlier than previously thought.

Tomorrow, the Ministry of International Trade and Industry will release revised figures on industrial production for June. Output rose 3 per cent in June from the previous month, according to preliminary figures.

"If the IP figure is higher than expected, it could pressure bonds lower," said an analyst.

Start your day with The Independent, sign up for daily news emails
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas