Tokyo stocks ended the week on a positive note Friday, rebounding from early losses as exporters got a lift after the yen's sharp rally fizzled. The Japanese unit gave up some of this week's strong gains against the dollar as officials warned about the impact of its rally, which is threatening to damage Tokyo's efforts to kickstart the economy. A strong yen is bad for Japan's exporting giants, such as Toyota and Sony, because it makes their goods more expensive overseas and shrinks the value of repatriated profits.
"Investors are going to be trading stocks based on how the yen moves for a while longer," Masahiro Ichikawa, a senior strategist at Sumitomo Mitsui Asset Management, told Bloomberg News. "The currency showing signs of weakness today has prompted repurchases in shares." In Tokyo afternoon trade the dollar rose to 108.77 yen from 108.31 yen in New York, where it briefly fell to 107.68 yen, a 17-month low.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange rose 0.46 percent, or 71.68 points, to close at 15,821.52, finishing higher for a second straight session. On the week, it was down 2.12 percent. The broader Topix index of all first-section shares gained 1.18 percent, or 15.05 points, to 1,287.69. It eased 1.05 percent over the week.
Next week, investors will be keeping an eye on US and Japanese economic data, US corporate earnings and the International Monetary Fund's latest estimates for global growth. The IMF is widely expected to scale back its predictions as a slowdown in China and weak oil prices weigh on the world economy.
The Nikkei's rise Friday came despite market heavyweight Fast Retailing plunging nearly 13 percent after it forecast a big decline in annual profits. The firm, which operates the Uniqlo clothing chain, late Thursday estimated net profit in the fiscal year to August would tumble about 45 percent, adding that warmer-than-expected weather also hit demand for Uniqlo's popular thermal underwear. Its shares dived 12.72 percent to 26,610 yen by the close.
Exporters rose in afternoon trade with Toyota closing 0.79 percent higher at 5,467 yen, while Sony was up 1.36 percent to 2,858.5 yen. Banking giant Mitsubishi UFJ rose 1.51 percent to 490.1 yen. Yahoo Japan surged 6.37 percent to 484 yen as Verizon and Google are reportedly in the race for buying a stake in the Japanese web company from US-based Yahoo.
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