TOKYO, Oct 21 (Reuters) - Japan's Nikkei stock average is likely to edge down on Wednesday after anaemic U.S. data prompted concerns about the pace of economic recovery and set off profit-taking on Wall Street, with resource-linked shares weak after commodity prices fell.
New construction of U.S. homes rose less than expected in September, and U.S. producer prices posted an unexpected decline, pointing to a weaker economic recovery.
The disappointing data prompted investors to take profits despite solid results earlier in the week from bellwethers such as Apple and Caterpillar Inc.
"The Nikkei has come to a relatively high level compared to recent months, so it'll be easy for profit-taking to emerge here as well, especially as Japan's earnings season begins in earnest," said Yutaka Miura, senior technical analyst at Mizuho Securities.
"This U.S. earnings season, profit-taking has taken share prices lower even when companies report good results on a sense that all the news is out now, and the same thing may well happen here in Japan."
A government-appointed task force crafting a revival plan for Japan Airlines cut its debt relief request to 250 billion yen ($2.8 billion) from 300 billion yen, but creditors still rejected the plan, two sources said.
Market players said that bank shares were likely to move in tandem with JAL, which has rebounded this week after losing 26 percent last week, but that JAL shares were expected to be volatile depending on the day and how demand played out.
The benchmark Nikkei is likely to move between 10,200 to 10,400, market players said. It closed at a three-week high of 10,336.84 on Tuesday.
Resource-linked shares such as Mitsubishi Corp and other trading houses may weaken after commodity prices slipped, but overall trading activity is likely to be lacklustre as the market waits for Chinese data on Thursday.
In an indication of how the market may move, Nikkei futures traded in Chicago rose 0.1 percent from the Osaka close of 10,330. STOCKS TO WATCH
-- Elpida Memory Inc
Elpida's manufacturing partner Powerchip said it requested T$4.5 billion ($140 million) from the Taiwan government and another T$5.5 billion from the private sector to set up a flash memory chip company.
Taiwan's Nanya Technology and Inotera, Nanya's joint venture with Elpida's main rival U.S.-based Micron, decided not to submit a DRAM restructuring plan to the government to request state funds.
-- Advantest Corp, chip gear makers
Orders for Japanese equipment used to make semiconductors narrowly outpaced sales for the sixth straight month in September, underlining a recovery in a sector emerging from a prolonged slump.
-- Toyota Motor Corp
Toyota is ramping up its push on gasoline-electric hybrids, launching a new model in Japan and taking on up-and-coming rival Hyundai Motor Co in its Korean home market with its flagship Prius.
Toyota, the world's largest automaker, said on Tuesday it aims to sell 36,000 units a year of its new Sai hybrid sedan in Japan, taking another step towards its goal of selling 1 million hybrid vehicles annually worldwide soon after 2010. (Reporting by Elaine Lies; Editing by Joseph Radford)