Tokyo Investors Look to Japan, U.S. Data after Yellen's Warning

Tokyo investors will be looking to Japanese trade data and U.S. retail sales next week, while bracing for any signs of a U.S. interest rate hike following a warning from Fed boss Janet Yellen on high equity valuations.

Japan's finance ministry is scheduled to release its March trade balance on Wednesday, while U.S. retail sales in April will be announced later in the day.

Toshikazu Horiuchi, a broker at IwaiCosmo Securities, said investors would continue watching for any signs of a U.S. rate hike after a warning from Federal Reserve chief Yellen that stock valuations were "quite high".

"The market is expected to remain nervous about economic indicators" related to an expected rate hike, Horiuchi said.

"Positive figures are welcome in general but if it's too good, that would fuel speculation that a rate hike is near," he added.

On Friday, stocks rose 0.45 percent after Wall Street rallied and the yen eased on hopes for a solid U.S. jobs report, while Nintendo shares surged on better-than-expected earnings.

The Nikkei 225 index at the Tokyo Stock Exchange gained 87.20 points to end at 19,379.19. It lost 0.78 percent over the week, which was shortened to two sessions by public holidays.

The Topix index of all first-section issues added 0.83 percent, or 13.12 points, to 1,587.76. It lost 0.14 percent this week.

Markets were gearing up for the U.S. Department of Labor's jobs report Friday to gauge whether the economy is strong enough for the Federal Reserve to begin raising ultra-low interest rates.

"If payrolls rebound to show growth of 240,000 to 250,000, we'll see U.S. long-term yields spike and the yen weaken, which will be positive for Japanese shares," said Juichi Wako, a senior strategist at Nomura Holdings.

"But if the data is worse than expected, we could see global stocks suffer a deeper correction as the market shifts toward a deflationary story."

In currency markets, the dollar was firm after rising on Thursday's positive U.S. weekly jobless claims report, buying 119.97 yen against 119.75 yen in New York late Thursday.

A weaker yen is positive for Japanese exporters as it makes them more competitive abroad and inflates the value of repatriated profits.

On Friday, Nintendo shares shot up 7.16 percent to 21,155.0 yen after the videogame giant announced better-than-expected full-year earnings late Thursday.

The company, which swung back into the black in its latest fiscal year thanks to a weak yen and stronger Wii U console sales, said its long-awaited move into the smartphone games market could double operating profit this year.

Toyota rose 0.79 percent to 8,279.0 yen ahead of the release of its fiscal year earnings.

After the market closed, the world's largest auto maker said its annual profit accelerated 19 percent to a record $18.1 billion.

Mobile carrier SoftBank climbed 1.72 percent to 7,354.0 yen after announcing it would buy an equity stake in major Japanese consumer electronics retailer Yamada Denki.

U.S. stocks pushed higher Thursday, with the Dow Jones Industrial Average advancing 0.46 percent and the broad-based S&P 500 gaining 0.38 percent.

-- Bloomberg News contributed to this article --