The Nikkei 225 index fell 0.8% to around 39,530 while the broader Topix index fell 0.8% to 2,750 on Friday, paring gains from the previous session and tracking losses on Wall Street overnight after some potentially disappointing economic data in the U.S. On the domestic front, investors reacted to data showing a slight improvement in sentiment among Japan's major manufacturers in the fourth quarter. This has reinforced expectations of a hawkish stance from the Bank of Japan, although uncertainty remains over whether the central bank will raise interest rates in December or January. Significant losses were seen among major index players, including Mitsubishi Heavy (-3.2%), Sony Group (-2.7%), Fast Retailing (-2%), Tokyo Electron (-2.2%) and Disco (-1.1%). Despite Friday's declines, both the Nikkei 225 and Topix were on track to close the week higher, marking their second straight week of gains.

Source: Trading Economics