* Profit-taking, futures selling weigh - market players
* Nikkei stays above 9,800; next target seen around 10,000
* Year-end buying of Japanese stocks likely to help -analyst
By Aiko Hayashi and Chikafumi Hodo
TOKYO, Nov 16 (Reuters) - Japan's Nikkei average inched lower on Tuesday, losing steam after earlier hitting a five-month high, but exporter shares rose on a weaker yen and lent support to the overall market.
The benchmark Nikkei managed to stay above 9,800, where it had faced resistance. A decisive break above that level will likely open the way to a climb towards 10,000, traders say. The next target is then expected to be around its June high of 10,251.90.
"Some investors likely bought stocks on corrective moves in the yen's strength, but that's not enough to keep pushing the market higher," said Kazutaka Oshima, president of Rakuten Investment Management.
"Corporate earnings have been solid so far, but outlooks are weak. Other stocks markets are also pausing, and at this point investors find it hard to lift the Nikkei beyond 10,000 just because Japanese stocks have been lagging behind."
By the midday break the Nikkei was down 0.2 percent at 9,805.52, with market players saying profit-taking and large-lot selling of futures were weighing on the market.
It earlier climbed as high as 9,908.30, its highest since June 24, but was held down by its 200-day moving average, now at 9,923, which is seen as immediate resistance.
The broader Topix fell 0.5 percent to 847.57.
So far this year the Nikkei is down about 7 percent. By contrast, the Dow Jones industrial average has gained more than 7 percent, while the MSCI index of Asia-Pacific stocks outside Japan has added about 12 percent.
Still, traders said the Nikkei is expected to be supported towards the end of the the year as foreign fund operators are keen to buy back Japanese shares.
"Foreign funds are buying back Japanese stocks while selling Japanese government bonds (JGBs), reflecting recent falls in prices," said Kenichi Hirano, operating officer at Tachibana Securities.
"They are looking to adjust their portfolios by increasing weightings in Japanese stocks ahead of the end of the year, but they are not in any rush to do so as there are no aggressive buyers beside them."
The dollar touched a near 6-week high of 83.28 yen on trading platform EBS, boosted by a surge in U.S. Treasury yields.
By late morning in Tokyo the greenback was around 83.10 yen.
Many Japanese companies have set their dollar/yen assumptions for the financial year to March at around 80 yen.
Gains in exporter shares helped support the market. Sony Corp rose 1.5 percent to 2,832 yen and Canon Inc rose 0.4 percent to 3,970 yen.
But energy-linked shares slipped as U.S. crude futures fell after the dollar extended its recent gains.
Inpex Corp, Japan's top oil explorer, declined 2.5 percent to 422,000 yen. (Editing by Michael Watson)