* Wall St reaction to Jobs' medical leave, Apple results eyed
* Chinese markets also in focus after yesterday's 2 pct drop
* Steelmakers lower on Nippon Steel profit drop report
By Antoni Slodkowski
TOKYO, Jan 18 (Reuters) - Japan's Nikkei average was little changed on Tuesday as investors waited to see Wall Street's reaction to news that Apple Inc CEO Steve Jobs would take medical leave for the third time since 2004.
Market players were also eyeing the Shanghai market after it slumped 2 percent the previous day on China's latest move to fight inflation.
Apple's announcement, which knocked U.S. stock futures sharply lower, came when U.S. markets were closed for the Martin Luther King holiday and ahead of the firm's earnings report due on Tuesday.
Investors said the news could have a huge impact on share moves because Apple accounts for around 7 percent of the Nasdaq Composite's market capitalisation.
"The 'Jobs Shock' can move not only individual shares or sectors, but whole indexes, so obviously investors will look closely at how the U.S. market reacts to both earnings and the news about Jobs," said Norihiro Fujito, a senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
"Investors may take profits on Apple first, but because it's expected to post strong results, Tokyo players want to wait for the figures and how U.S. investors react to the news.
By midmorning the benchmark Nikkei was up 0.1 percent or 10.36 points at 10,512.51. The broader Topix index had risen 0.3 percent to 931.74.
Nippon Steel Corp and other steelmakers were among the biggest decliners on the Nikkei after a report by the Nikkei business daily that Nippon Steel will likely post a pretax profit of about 220 billion yen for the year ending in March, about 30 billion yen below its forecast.
"This fall reflects higher commodities prices that have been benefiting trading houses such as Mitsubishi Corp," said Fujito.
Nippon Steel fell 2 percent to 291 yen and JFE Holdings Inc lost 1.7 percent to 2,779 yen.
Elpida Memory rose 2.9 percent to 1,116 yen after the Nikkei said the firm plans to raise prices of personal computer DRAMs by about 10 percent as early as this month.
Yoshinoya Holdings Co jumped 3.3 percent to 109,400 yen after the fast food restaurant operator said it plans to become the largest holder of its own shares by buying back the 21 percent stake owned by trading house Itochu Corp for around 14 billion yen ($169 million). (Reporting by Antoni Slodkowski; Editing by Chris Gallagher)