FX.co ★ Japanese Shares Fall After GDP Data

On Monday, the Nikkei 225 Index modestly decreased by 0.3% to approximately 50,200, while the broader Topix Index experienced a decline of 0.5% to 3,342, continuing the downward trend from the previous session. This downturn occurred despite Japan's economy demonstrating stronger than anticipated growth figures. In the three months leading up to September, the economy contracted by 0.4% quarter-on-quarter, a reversal from the 0.6% expansion witnessed in the second quarter, yet still surpassing market expectations of a 0.6% contraction. Investors are currently assessing the potential direction of the Bank of Japan's policy as officials hint at possible rate increases, even as Prime Minister Sanae Takaichi advocates for maintaining low rates. The Japanese stock market's decline also echoed the soft performance on Wall Street, driven by ongoing concerns over the high valuations of AI-related stocks and the unpredictability of the Federal Reserve's policy direction. Among the key decliners were Mitsubishi UFJ, which fell by 1.1%, Sanrio at -6.7%, Fast Retailing down by 4.2%, Nidec decreasing by 6.1%, and Sony Group dropping 2.9%.