* Long-term impact from S&P cut on U.S. credit should be limited on Japan stocks-trader
* Chip shares underperform on poor TI earnings
* Volume may stay thin on Tue-analysts
By Ayai Tomisawa
TOKYO, April 19 (Reuters) - Japan's Nikkei stock average fell 1 percent on Tuesday after rating agency Standard & Poor's downgraded the United States's credit outlook to negative, pushing the yen higher and Wall Street lower.
Trading volume may stay thin on Tuesday, analysts added, as investors may want to keep to the sidelines before Japanese corporate earnings starting later this month. Volume hit its second-lowest level for 2011 on Monday.
The euro and dollar were steady against the yen in early trade after tumbling 1.9 percent and 0.6 percent, respectively, the previous day on an unwinding of carry trades.
Some market players said they did not see S&P's move as continuing to have a big effect on the Tokyo stock market.
"S&P's downgrade of its U.S. credit outlook may have a short-term impact on Japan stocks in terms of concerns about the stronger yen," said Makoto Nagahori, head of sales trading at Instinet. "But its long-term impact should be limited."
Chip shares underperformed after Texas Instruments Inc warned that its second-quarter revenue would be hurt by interruptions in production due to the quake damage and power-supply disruptions at two plants in Japan.[ID:nN18221973]
Advantest dropped 3.4 percent to 1,402 yen while Tokyo Electron shed 1.6 percent to 4,315 yen.
The benchmark Nikkei average was down 1.1 percent, or 105.44 points at 9,451.21, while the broader Topix shed 1.0 percent to 828.21.
Analysts said the Nikkei is expected to trade between 9,400-9,600 on Tuesday.
Shares of electronics maker Toshiba Corp outperformed the market gaining 0.8 percent to 404 yen after the Nikkei business daily said the electronics maker is likely to post 130 billion yen ($1.6 billion) net profit for the 2010/11 business year, better than the 100 billion yen estimate the company made earlier.
That would would come in above the average estimate of 96.75 billion yen in a survey of 19 analysts by Thomson Reuters I/B/E/S. (Additional reporting by Antoni Slodkowski)