* Short-covering helps prevent market from falling sharply
* Gains may be limited as concerns over oil prices persist
By Ayai Tomisawa
TOKYO, March 8 (Reuters) - Japan's Nikkei benchmark edged higher on Tuesday as investors covered short positions after selling heavily the previous day, but gains may be limited as concerns about the Middle East turmoil and oil prices persist, analysts said.
Buying in Monday's decliners, such as exporters, offset losses in tech shares, which followed their U.S. counterparts lower. The Nasdaq composite index dropped 1.4 percent on Monday.
Analysts said that although short-covering may help prevent the market from falling sharply, the market may see selling in the afternoon if oil prices rise.
"We may see more selling by futures players today just like yesterday, depending on how worries about high oil prices intensify," said Masumi Yamamoto, a market analyst at Daiwa Securities Capital Markets. "There is room for the Nikkei to turn negative today."
The benchmark Nikkei was up 0.2 percent, or 19.93 points, at 10,524.95 in midmorning trade. The broader Topix index gained 0.1 percent to 942.61.
Yamamoto said the Nikkei faced immediate resistance at its five-day moving average of 10,561.
Tech shares underperformed the market, with Toshiba Corp falling 0.6 percent to 515 yen, Sony Corp dropping 0.8 percent to 2,904 yen and Tokyo Electron shedding 1.1 percent to 5,230 yen.
But Hitachi Ltd gained 1.8 percent to 514 yen after the electronics conglomerate said it would sell its hard disk drive operations to Western Digital for about $4.3 billion in cash and stock.
Terumo Corp climbed 3.8 percent to 4,665 yen after the company said it would buy U.S. medical device company CaridianBCT from a Swedish firm for about $2.6 billion, marking the largest acquisition by a Japanese medical equipment maker. (Additional reporting by Antoni Slodkowski; Editing by Chris Gallagher)