Tokyo investors to keep cautious tone

Tokyo - Asian investors will likely adopt a cautious stance next week after the Nikkei turned down in its first trading week of 2014, dealers said, with early exchanges dictated by Friday's US jobs data.

The benchmark index closed Friday up 0.20%, or 31.73 points, to 15 912.06 on late buying after spending most of the day in negative territory. It finished down 2.33% over the week.

The Topix index of all first-section shares rose 0.13%, or 1.73 points, to 1 298.48, but slipped 0.30% over the week.

There was only one day of trading last week ahead of a four-day national holiday.

Sidelines

The Nikkei was hit by profit-taking this week after enjoying a surge of 57% last year -- its best performance since 1972.

The US labour department will later on Friday release its December non-farm payrolls data, giving investors an idea about the state of the US economy and, if strong enough, they could provide the Federal Reserve more ammunition to further cut its stimulus programme.

Chief market strategist of Sumitomo Mitsui Banking, Daisuke Uno,said: "Investors sat on the sidelines ahead of the US employment report, but the Nikkei gained towards the closing, thanks to a strong outlook for the jobs data."

Dramatic fall

Uno said investors would also be keeping an eye out for more clues to the state of the Chinese economy, after data Friday showed its annual trade surplus reached $259.75bn in 2013, up 12.8% from the previous year.

"I don't think the Nikkei is likely to suffer a dramatic fall next week, with investors responding to the US jobs data," Uno said.

"But market players are cautiously watching out for the Shanghai index, which may fall below the 2 000 mark soon and other negative factors out of concerns that the Chinese economy may be slowing," he added.

On Friday, the benchmark Shanghai Composite Index fell 0.71%, or 14.32 points, to 2 013.30, and was down 3.35% over the week.

Exporters

In Tokyo, Mitsubishi Materials ended down 1.59% at 370 yen after an explosion at one of its chemical plants killed five workers and injured a dozen on Thursday.

Auto giant Toyota gained 0.31% to 6 290 yen, Canon fell 0.91% to 3 235 yen and Uniqlo clothing chain operator Fast Retailing added 3.26% to 41 100 yen.

Tokyo stocks also got a lift from a fall in the yen, which is good for Japanese exporters. The dollar changed hands at 104.97 in late afternoon trade, against 104.79 yen in New York on Thursday.