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Nikkei set to gain, new govt policies eyed

Published 09/16/2009, 07:23 PM
Updated 09/16/2009, 07:24 PM
SONY
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TOKYO, Sept 17 (Reuters) - Tokyo's Nikkei average is likely to rise on Thursday, with exporters such Sony Corp seen higher after industrial output data helped buoy U.S. stocks to fresh 2009 highs.

But analysts said market gains may be capped as investors closely examine policies of new Japanese Prime Minister Yukio Hatoyama's government launched on Wednesday.

New Finance Minister Hirohisa Fujii has already moved currency markets, saying after recent currency moves were not rapid and that a strong yen had merits for the economy.

The choice of Shizuka Kamei, the outspoken head of a tiny coalition partner and an opponent of market-friendly reforms, as minister for banking and market regulation sent bank shares lower with comments on lending.

"The Nikkei will likely try the 10,380 level after U.S. industrial output data beat expectations and because the dollar/yen hasn't broken below 90 yen," said Kazuhiro Takahashi, general manager at Daiwa Securities SMBC.

"But there is still uncertainty about new government policies such as Kamei's policy on lending, which investors see as negative for financials. Coupled with concerns about moves in the currency market during the holiday here, today's trade will likely be range-bound."

Kamei told reporters on Tuesday that he would like to introduce a moratorium on some loan repayments to help small and midsize businesses and individuals struggling from the economic downturn.

Nikkei futures traded in Chicago closed at 10,385 on Wednesday, up 1.7 percent from the Osaka close, pointing to a higher start.

Market participants expect the benchmark Nikkei to move between 10,200 to 10,450 on Thursday. It rose 0.5 percent the previous day to end at 10,270.77.

Japanese markets will be closed in a five-day holiday period from Sept. 19-23.

U.S. stocks rose for a third day on Wednesday, hitting fresh 2009 highs in a broad-based rally after data showing U.S. industrial output advanced for a second consecutive month in August. STOCKS TO WATCH

-- Japan Airlines Corp (JAL)

Japan's new transport minister, Seiji Maehara, said he would review turnaround plans for Japan Airlines Corp (JAL) as bidders circle the loss-making carrier.

Separately, the Nikkei business daily reported that JAL will propose a plan to former and current employees to reduce pension benefits and spread out its obligations over a longer period, that will result in a profit this fiscal year.

-- Kao Corp

Kao, Japan's largest maker of toiletries, said it will halt the shipment in Japan of its flagship Enova cooking oil products, because they contain fatty acid glycidyl esters. Glyceride ester is said to be a possible cause of cancer.

-- Ryohin Keikaku Co Ltd

The operator of Muji stores cut its full-year operating profit forecast by 12.7 percent after weak consumer spending hit its sales, especially those of furniture and other home furnishing items.

The company said it now expects operating profit to come at 15.3 billion yen ($168.4 million) for the year ending in February, roughly in line with a mean estimate of 15.5 billion yen in a poll of 12 analysts by Thomson Reuters I/B/E/S. (Reporting by Aiko Hayashi; Editing by Edwina Gibbs)

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