Japanese shares will likely be under pressure next week as investors look ahead to the release of Japan's Tankan economic sentiment survey and key China data, dealers said Friday. In the week to September 28, the benchmark Nikkei 225 index at the Tokyo Stock Exchange slipped 2.63 percent, or 239.84 points, to 8,870.16.
The broader Topix index of all first-section issues lost 2.51 percent, or 18.96 points, to 737.42. "September is traditionally not a good month for equities, but we've managed to pull through decently... especially through global policy easing steps," an equity trading director at a foreign brokerage told Dow Jones Newswires. "Looking forward to next week, however, the pressure will be back on, with the Japan quarterly Tankan not likely to be rosy," the dealer said, referring to the Japanese economic sentiment survey to be released on Monday.
The trading director also said investors were looking to China's purchasing managers' index (PMI), with "a good chance that corporates will revise down their earnings projections." China's PMI is due out on Monday, which will provide fresh clues to the state of the world's number two economy following a string of figures showing a slowdown.
Japan's export-driven economy is struggling to right itself following the March 2011 earthquake and tsunami disaster, while also suffering from Europe's debt crisis, slowing Chinese demand and the strong yen.
Japanese businesses are now worried about taking a hit from the effects of a flare-up in the row between Tokyo and Beijing over the ownership of islands in the East China Sea.
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