Japanese Shares Slide as Q2 GDP Revision Raises BOJ Rate Hike Uncertainty

Japanese shares closed lower Monday as revised second-quarter GDP figures cast uncertainty over the Bank of Japan's rate hike and stimulus exit plans.

The Nikkei 225 fell 0.48%, or 175.72 points, to 36,215.75.

The Cabinet Office reported Japan's GDP grew at an annualized rate of 2.9% in Q2, revised down from 3.1%. Private consumption and capital investment were slightly downgraded, with monthly growth at 0.7%, down from 0.8%.

Following a July increase in the key interest rate to 0.25% from 0-0.1%, markets are keenly awaiting the BOJ's next moves.

In other updates, Japan's banks and lenders reported outstanding loans of 624.2 trillion yen in August, a 3% increase year-on-year, per the Bank of Japan.

Major and regional banks held 546.7 trillion yen, up 3.4%, while shrinking lenders saw a 0.7% rise to 775.1 billion yen. Rising loan totals suggest improving economic health and credit demand.

Japan's trade deficit widened to 379.8 billion yen in August from 22.5 billion yen a year earlier.

Export growth was outpaced by a surge in imports, with August exports rising 12.3% to 5.514 trillion yen and imports up 19.5% to 5.894 trillion yen, according to preliminary Ministry of Finance data.

In corporate news, IX Knowledge (TYO:9753) reported a 9.5% drop in quarterly profit to 336 million yen, with EPS at 35.23 yen and net sales decreasing 0.8% to 5.46 billion yen.

Meiji Holdings (TYO:2269) plans to construct a new plant in Atsugi to enhance yogurt production efficiency.

SoftBank Group (TYO:9984) repurchased 15.8 million shares for 126.87 billion yen in August, continuing its buyback program through August 2025.