Tokyo investors will stay focused on the US government shutdown next week, as fears grow it could lead to a devastating debt default and strike a huge blow to the global economy.
The Nikkei's 0.94 per cent slip on Friday to a one-month low ended a week that saw the benchmark index lose 4.98 per cent, or 735.76 points, to 14,024.31, as the political deadlock in Washington dominated headlines.
The broader Topix index of all first-section shares fell 4.41 per cent, or 53.70 points, over the week to 1,163.82.
'Players will keep an eye on the US budget stand-off next week,' said Kenzaburo Suwa, strategist with Okasan Securities.
'But we may see an early end to the impasse as (President Barack) Obama appears serious by cancelling key conferences overseas,' Suwa added.
Obama axed plans to attend the Asia Pacific Economic Cooperation (APEC) summit in Bali and the East Asia Summit in Brunei next week, blaming political paralysis in Washington for the cancellation.
While the shutdown has fuelled jitters among investors, analysts have generally expressed even deeper concerns about the October 17 deadline to raise the US debt ceiling.
International Monetary Fund chief Christine Lagarde warned on Thursday that a US failure to raise the borrowing limit could wreak havoc on the global economy, while the Treasury Department said a default could have a 'catastrophic' effect.
On Wall Street, the Dow ended 0.90 per cent lowe...