TOKYO, Feb 3 (Reuters) - Japan's Nikkei average is seen trapped in a narrow range on Thursday, after posting the biggest jump in two months the day before, as worries over an escalation of violence in Egypt may offset strong U.S. jobs data.
Investors on Wall Street were reluctant to make big bets even though a report showed U.S. private-sector employers added more jobs than expected in January, amid signs the market is overbought while cautiously eyeing developments in Egypt..
Running battles between opponents and supporters of President Hosni Mubarak on the streets of Cairo left one dead and hundreds injured, helping send oil prices above $100 a barrel.
This week marks the peak of Japan's corporate results reporting season for the October-December quarter, with such economic bellwethers as Sony Corp, Japan's biggest bank by assets Mitsubishi UFJ Financial Group, Sharp Corp and Hitachi Ltd reporting on Thursday.
"The Nikkei will be stuck in a range at the beginning, after violence in Egypt pushed investors towards safer assets and on a muted performance on Wall Street," said Hiroichi Nishi, general manager at Nikko Cordial Securities.
"But it may even go higher as trading volume increased yesterday and as the U.S. data shows the global economy is on a sustained recovery path."
Nikkei futures traded in Chicago closed at 10,460, same level as the Osaka close, also pointing to a flat start.
Smelters and energy shares will likely extend gains after the price of copper, a key industrial metal, hit a record high on Wednesday on expectations of strong global demand.
Brent crude topped more than $102 a barrel, a 28-month high, on worries that the flare-ups in Egypt could spread across the Middle East and North Africa, the source of more than a third of the world's oil.
Market players said the Nikkei is also likely to be supported by inflows of short-term capital as markets in China, Hong Kong, South Korea, Singapore and Taiwan remain closed for the Lunar New Year holiday.
The benchmark index is expected to move between 10,350 and 10,500 on Thursday, market players said. It ended up 1.8 percent on Wednesday, posting the biggest daily gain since Dec. 2. ----------------------MARKET SNAPSHOT @ 2213 GMT ------------
LAST PCT CHG NET CHG S&P 500 1304.03 -0.27% -3.560 USD/JPY 81.53 -0.01% -0.010 10-YR US TSY YLD 3.4791 -- 0.044 SPOT GOLD 1334.7 -0.10% -1.300 US CRUDE 90.91 0.15% 0.140 DOW JONES 12041.97 0.02% 1.81 ------------------------------------------------------------- > Wall Street stalls on signs rally is played out > Euro falls from 2-1/2-month high; ECB meeting eyed > Rising food, oil prices hurt bond market > Gold drops on economic optimism as safe haven muted > Oil rises as worries over Egypt persist
STOCKS TO WATCH:
-- Nomura Holdings
Japan's biggest brokerage, reported a 31 percent rise in third-quarter net profit on Wednesday after gains in Tokyo stocks boosted fees.
Nomura, which is expanding in Asia, Europe and the United States after buying a big chunk of Lehman Brothers in 2008, posted a net profit of 13.39 billion yen ($164 million) for the three months ended Dec. 31, compared with 10.2 billion in the same period a year earlier.
-- Panasonic Corp
Panasonic posted a worse-than-expected 5.6 percent fall in quarterly profit as tough price competition and a stronger yen offset help from Japan's incentive scheme for eco-friendly appliances and its buyout of subsidiary Sanyo Electric.
-- Nippon Steel Corp, JFE Holdings Inc
Japanese steelmakers' buoyant production may continue into the current quarter on strong demand from Asia, despite disruptions in the supply of coal from Australia that have forced them to rely on the costlier spot market.
A government poll of about 60 big Japanese steelmakers released on Wednesday showed the companies plan to produce 28.40 million tonnes of crude steel in January-March, up 2.6 percent from the previous quarter.
-- Sony Corp
Sony is expected to post a 15 percent fall in October-December profit on Thursday, hurt by a stronger yen and tough price competition in the flat TV market.
-- MS&AD
Mitsui Sumitomo Insurance, a unit of Japan's largest property-casualty insurance firm MS&AD, said on Wednesday it may buy a stake in Malaysia's Hong Leong Tokio Marine Takaful to tap growing demand for Islamic insurance.
-- Honda Motor Co
Honda is looking to make small investments in North America to build more of its popular CR-V crossovers there, reducing exports from Japan to cushion the blow from a strong yen, an executive said.
-- Fast Retailing
Monthly sales at Fast Retailing's Uniqlo stores in Japan rose for the first time in six months in January, boosted by strong demand for winter clothing.
The firm also plans to ramp up its global push next year by hiring 1,050 new graduates abroad for shots at career-track positions, the Nikkei business daily said.
The company has already made job offers to 730 new grads overseas for 2011, more than double the number it had originally planned, said the daily. ($1=81.72 Yen) (Reporting by Antoni Slodkowski; Editing by Michael Watson)