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Nikkei set to rise on Wall St rebound, earnings eyed

Published 10/22/2009, 07:28 PM
Updated 10/22/2009, 07:32 PM
CAJPY
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TOKYO, Oct 23 (Reuters) - The Nikkei average is likely to rise on Friday, led by exporter shares on a weaker yen and after a rebound in U.S. financial stocks buoyed Wall Street, but trade may be cautious as investors await Japanese earnings reports.

Canon Inc may draw attention after the Nikkei business daily said the company's operating profit likely rose about 30 percent from the previous quarter to around 60 billion yen ($657 million) in July-September due to cost reductions and strong digital camera sales.

"After gains in U.S. stocks, the market here will likely rebound," said Kazuhiro Takahashi, general manager at Daiwa Securities SMBC.

"But investors are likely to gradually take a wait-and-see approach ahead of the weekend and a series of Japanese corporate earnings announcements next week."

Nikkei futures traded in Chicago finished at 10,355.00 on Thursday, up 0.8 percent from the Osaka close, pointing to a higher start.

The benchmark Nikkei is likely to move between 10,200 and 10,400 on Friday, market players said. It fell 0.6 percent the previous day to end at 10,267.17.

Japan's earnings season will kick into full gear next week.

The dollar was trading around 91.30 yen in early Asia trade. Many Japanese exporters have set their currency rate assumptions at 90-95 yen for the year to March.

U.S. stocks rose on Thursday after quarterly results from insurer Travelers Cos Inc and regional bank PNC Financial Services Group Inc gave a boost to financial stocks. STOCKS TO WATCH

-- Hoya Corp

Hoya will likely report 15 billion yen in group operating profit for the July-September period, up 60 percent from the April-June quarter thanks to robust sales of hard-disk drive materials, the Nikkei business daily reported on Friday.

-- Japan Airlines

The government plans to provide guarantees for a 200 billion yen ($2.2 billion) bridge loan to Japan Airlines, which needs the funds to keep operating while it plans and carries out its restructuring, the Nikkei business daily reported on Friday.

-- Mitsubishi Motors Corp

Mitsubishi Motors will likely post a smaller group operating loss than projected for the six months ended Sept. 30, helped by rising sales in Japan and emerging markets, the Nikkei business daily reported on Friday.

The car maker will post a loss of about 30 billion yen for the six months, which would be 5 billion yen less than its forecast but still worse than the 25.3 billion yen operating profit of a year earlier, the newspaper said.

-- Nippon Steel Corp, JFE Holdings Inc

Nippon Steel and JFE are likely to report pretax losses of nearly 100 billion yen ($1.1 billion) and close to 60 billion yen, respectively, in the April-September period, the Nikkei business daily said.

The figures would represent an improvement of more than 10 billion yen compared with earlier forecasts, the Nikkei said, as major steelmakers enjoy a resurgence in business as economic stimulus measures implemented in various countries revive demand.

-- Tokyo Electron Ltd

Tokyo Electron, the world's second-largest semiconductor equipment maker, said on Thursday it would post a quarterly operating loss two-thirds smaller than expected on a rise in sales and cost cuts.

-- Tokyo Electric Power Co (TEPCO)

Tepco said it would gradually raise power output at the 1,100 megawatt No.4 reactor at its Fukushima-Daini nuclear plant after a problem with a pump prompted it to cut output by more than two-thirds since last week. ($1=91.29 Yen) (Reporting by Aiko Hayashi; Editing by Chris Gallagher)

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