TOKYO, JAPAN – DECEMBER 23, 2012: Pedestrians cross at Shibuya Crossing. It is one of the world’s most famous scramble crosswalks.

Japan’s Nikkei 225 ended the week on a low note after declining by more than 0.35% on Friday morning after the release of last month’s Household spending. Australia’s ASX 200 edged up by 0.06% while Hong Kong’s Hang Seng index was up by 0.12%.

Japan Financial Outlook

The Nikkei 225 index will react to the latest household spending data released on Friday. Japan’s household spending increased 0.1% month-on-month and 13% YoY. Despite the increase, the household spending remained below pre pandemic levels.

According to the Statistics Bureau of Japan, expenditure for Two or more person households recorded a monthly average consumption expenditure of 301,043 JPY. Nominal terms were up 12.4% and up 13% in real terms from the previous year.

The average of monthly income per household for Workers stood at 543,063 JPY. It was up 2.3% in nominal terms and up 2.8% in real terms from the previous year.

Household spending dropped 11.1% in April 2020 due to the government’s first state of emergency over the virus. Lockdown restrictions and closure of nonessential businesses cut into consumer spending. Household spending is a key indicator of private consumption, which plays an important role in the Nikkei 225 index.

Spending on clothing and shoes surged 84.8% in April. This was partly because schools were reopened in April and some companies resumed to conducting businesses.

US Data Outlook

Inflation fears are hovering the markets after positive US employment data. The strong US economic recovery boosted bets for higher inflation and an earlier tightening of Federal Reserve stimulus. US treasury yields jumped, lifting the dollar.

Tech shares were affected after a better-than-expected employment data raised expectations for a strong reading for nonfarm payrolls on Monday. US Service sector climbed to a record high on Thursday.

Investors will be monitoring China’s response to an amend signed by US President Joe Biden. The order states that Bide banned US investment into Chinese companies and 59 firms with ties to China’s military.

Nikkei 225 Movers

Citizen Holdings, an electronics company, was the best performer in the Nikkei 225 index with a 4.83% increase. Other top performers in the index include J. Front Retailing, Mazda Motor and Mitsui Chemicals Inc each with a more than 4.10% increase.

Sumitomo Metal Mining was the worst performer in the index with a 2.75% decline. Z Holdings and Tokyo Electric Power also lagged.

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