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Japan’s latest Ministry of Finance corporate survey showed a sharp slowdown in capital expenditure growth in the third quarter, even as company profits surged.

• Business spending rose 2.9% y/y, well below expectations of around 6% and down from 7.6% in Q2.
• Capex excluding software also increased 2.9%, missing forecasts and marking a clear deceleration.
• Corporate sales were broadly flat, up just 0.5% y/y, only marginally above estimates.
• The standout surprise came from profitability: company profits jumped 19.7% y/y, far exceeding expectations of 3.7% and rebounding from just 0.2% previously.
• The divergence — weak investment but strong earnings — highlights a cautious corporate stance amid economic uncertainty, despite healthier bottom-line performance.

The data will feed directly into GDP revisions and will be closely scrutinised ahead of the Bank of Japan’s December meeting, with policymakers watching for signs of durable investment momentum.

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In summary:

• Q3 capex +2.9% y/y, far below 5.9% expectations and down from 7.6% prior.

• Capex ex-software also +2.9%, missing 5.4% forecast.

• Company profits surged 19.7% y/y (vs 3.7% expected).

• Company sales +0.5% y/y, slightly above estimates.

It emerged this week that the US government, together with AMD, has launched the “Mission Genesis” initiative aimed at boosting national computing power through advanced supercomputing.

Asian Stock Markets a Bit Higher; USD/JPY Trading Above ¥156.50; Crypto Sector Losing Value

The JP 225 stock index corrected towards the support level, but the global trend remains upward. The JP 225 forecast for today is positive.

JP 225 forecast: key trading points

• Recent data: Japan’s GDP in Q3 2025 decreased by 1.8%
• Market impact: moderately negative for the Japanese stock market

JP 225 fundamental analysis

Japan’s annualised GDP indicator showed a decline of -1.8% versus the forecast of -2.5% and the previous growth of 2.3%. This means the economy shifted from expansion to contraction, although the downturn turned out to be less severe than analysts expected. Formally, this still signals cooling: companies on average produce and sell less than a year ago, and both domestic and external demand weakened. Such data is generally negative for the Japanese stock market because a weaker economy usually implies cautious consumer and business behaviour, slower investment activity, and pressure on company revenues, especially those focused on the domestic market.

For the JP 225 index, where a significant share belongs to large export-oriented companies, the effect is also mixed. On the one hand, weak GDP hits expectations for domestic demand. On the other hand, the Bank of Japan’s soft policy and the associated risks of a weaker yen support exporters, as a declining currency boosts their competitiveness and increases profits when converted into yen.

JP 225 technical analysis

Within the correction phase, the JP 225 rebounded from the 48,425.0 support level. Before resuming its rise, the index may trade sideways. The global trend remains upward. The resistance level has formed at 52,680.0. The nearest upside target stands at 55,000.0.

The JP 225 price forecast considers the following scenarios:

• Pessimistic JP 225 scenario: a breakout below the 48,425.0 support level could send the index down to 46,370.0
• Optimistic JP 225 scenario: a breakout above the 52,680.0 resistance level could drive the index up to 55,000.0

Summary

In the short term, Japan’s stock market and the JP 225 index will likely react with heightened volatility: some investors will price in the risk of further slowdown, while others will bet on central bank support and a potentially weaker yen. In the long run, the future trajectory of the JP 225 will depend on whether upcoming macroeconomic reports confirm a declining trend and what specific actions the Bank of Japan takes. The next upside target for the JP 225 stands at 55,000.0.

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