TOKYO, Oct 5 (Reuters) - Japan's Nikkei average is likely to start lower on Tuesday, pressured by falls on Wall Street, with eyes on the outcome of the Bank of Japan's policy-setting meeting that ends later in the day and the reaction in the currency markets.
Japan's central bank might announce additional monetary easing measures going beyond initial expectations, the Nikkei business daily reported on Tuesday.
Initially, the bank was seen expanding low-interest loans to financial institutions for durations of three to six months, but more board members argue that the bank should go further to show it is serious about curbing the yen's appreciation and ending deflation, the Nikkei said.
Kazuhiro Takahashi, general manager at Daiwa Securities Capital Markets, said investors will likely take a wait-and-see approach after U.S. stocks took a breather the previous day, and as they await the decision from the BOJ meeting.
"If the BOJ says it will expand its money market operations, which had been the market consensus, the market will likely be pressured as the news will have run its course, but a temporary impact may be expected if there are any surprises," he said.
"Still, it's hard to expect a lot from it either way, and the focus will likely be whether there will be currency intervention, or whether expectations for such moves will increase after the announcement."
Nikkei futures traded in Chicago closed at 9,350, unchanged from the Osaka close.
The benchmark Nikkei is likely to move between 9,200 and 9,500, market players said. It fell 0.3 percent on Monday to 9,381.06.
Initial support is seen around 9,340 points, the Nikkei's 55-day moving average, and around the 25-day moving average, which is now at 9,307.
Resistance likely looms around 9,530, the upper level of the Nikkei's daily Ichimoku cloud on charts. Ichimoku charts are popular with Japanese traders.
U.S. stocks fell in light trading on Monday as investors took profits on recent gains, using middling economic data and worries about euro zone debt as a catalyst for shedding long positions.
The dollar hovered not far from a 15-year low against the yen, keeping speculation alive that Japan may re-enter the market to weaken its currency. In early Asia trade, the dollar traded at 83.52 yen, above its 15-year low of 82.87 yen set just before Japan intervened in the currency market for the first time in six years on Sept. 15. ----------------------MARKET SNAPSHOT @ 2307 GMT ------------
LAST PCT CHG NET CHG S&P 500 1137.03 -0.8% -9.210 USD/JPY 83.54 0.17% 0.140 10-YR US TSY YLD 2.4794 -- 0.000 SPOT GOLD 1313.05 -0.16% -2.150 US CRUDE 81.37 -0.12% -0.100 DOW JONES 10751.27 -0.72% -78.41 ------------------------------------------------------------- > Wall Street falls as investors book gains > Euro rally pauses, but uptrend vs dollar intact > Bonds up on stock slide, possible Fed purchases > Gold eases as dollar rises on euro-zone worries > Oil dips on dollar's gain, port problems support
STOCKS TO WATCH
-- Konica Minolta Holdings
Konica Minolta aims to more than double operating profit from current levels to over 100 billion yen ($1.20 billion) in the year to March 2014, CEO Masatoshi Matsuzaki said in an interview on Monday.
-- Fast Retailing
Fast Retailing said sales at its Uniqlo budget fashion chain plunged 24.7 percent in September from a year earlier, the biggest fall in more than 7-½ years, as a severe heatwave battered sales of autumn clothing including long-sleeved shirts.
-- Sharp Corp
Sharp is teaming up with Culture Convenience Club to distribute such content as e-books, music and video for its Galapagos tablet devices coming out in December, the Nikkei business daily reported. (Reporting by Aiko Hayashi; Editing by Edmund Klamann)