Japanese investors are likely to take their cue from a slew of economic data next week, including a closely watched survey of business confidence, dealers said on Friday.
The Bank of Japan's quarterly "Tankan" survey is expected to show an improvement in sentiment among Japan's major manufacturers from a record low the previous quarter, helping to underpin improving investor confidence.
Traders "widely expect the index to improve, or at least to not fall. I think the mood will be positive," said Okasan Securities equity strategist Hirokazu Fujiki. That optimism may help lift the Nikkei index back above the 10,000-point level, which it topped two weeks ago for the first time in eight months, before retreating on fresh worries about the global economy, dealers said.
Over the week to June 26, the Nikkei-225 rose 91.13 points, or 0.93 percent, to end Friday at 9,877.39. The Topix index of all first section shares edged up 7.83 points, or 0.85 percent, to 926.80. As well as the domestic indicators slated for release next week, investors will be digesting US figures including housing, manufacturing and job reports, amid hopes of an early recovery for the world's biggest economy.
US markets will be closed Friday for Independence Day. While the mood seems to be improving, there is also a risk of a fresh sell-off, particularly if US data disappoint, dealers said. While the pace of job losses in the US appears to have slowed recently, the employment situation in the world's largest economy remains persistently weak, said Toyo Securities strategist Hiroaki Hiawata. "The big question mark for investors is, until when will (the negative job situation) continue?" he said. The unemployment rate in the United States jumped to a 26-year high of 9.4 percent in May.
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