TOKYO, Sept 30 (Reuters) - Japan's Nikkei average is expected to book its best monthly performance in six months on Thursday, helped by expectations for further easing by the central bank and that the yen's rapid advance could be curbed by more intervention by the authorities.
Wall Street took a breather from a month-long rally on Wednesday, and Nikkei futures traded in Chicago closed at 9,560, unchanged from the Osaka close, indicating that the benchmark Nikkei will likely to move narrowly on Thursday.
But the Nikkei is poised for gains of nearly 10 percent for the month of September, which would be its biggest monthly rise since March, having been buoyed by short-covering in exporters after intervention by Japanese authorities to weaken the yen two weeks ago.
"The market will likely be helped by expectations for more easing in monetary policy as well as companies' window dressing moves for the end of the month. Japanese stocks have also lagged behind global stocks," said Hiroichi Nishi, general manager of equity marketing at Nikko Cordial Securities.
"The market will likely be solid going forward, though trade will probably be range-bound for a while as the economy has shown signs of a lull. That said, the possibility of more currency intervention will likely support."
Expectations grew that the Bank of Japan will discuss easing monetary policy further at a meeting next week after a poor December outlook in the central bank's "tankan" survey of business sentiment released on Wednesday.
The Nikkei is likely to move between 9,450 and 9,650 on Thursday, market players said. On Wednesday, it rose 0.7 percent to 9,559.38, but kept below resistance around 9,660 -- the upper level of its daily Ichimoku cloud on charts.
Despite the monthly gain, persistent worries about the threat a strong yen poses to a fragile economic recovery kept the Nikkei's performance for the July-September quarter in check.
The Nikkei's rise of only about 2 percent during the period compares with a 17 percent gain in the MSCI index of Asia Pacific stocks outside Japan. ----------------------MARKET SNAPSHOT @ 2249 GMT ------------
LAST PCT CHG NET CHG S&P 500 1144.73 -0.26% -2.970 USD/JPY 83.76 0.05% 0.040 10-YR US TSY YLD 2.5009 -- 0.000 SPOT GOLD 1308.95 0.01% 0.150 US CRUDE 77.85 -0.01% -0.010 DOW JONES 10835.28 -0.21% -22.86 ------------------------------------------------------------- > Wall St slips as it puts September rally on 'pause' > Dollar slides for 4th session, euro hits 5-mo high > Bonds fall as rally pauses; strong 7-yr auction > Gold extends record-breaking rally on dollar slide > Oil ends at 7-week high on inventory draw
STOCKS TO WATCH
-- Nippon Steel Corp
Nippon Steel and India's Tata Steel Ltd are in talks to set up a blast furnace facility in India through a joint venture, the Nikkei business daily reported.
-- Inpex Corp
Inpex has decided to withdraw from the Azadegan oil field development project in Iran due to pressure from the U.S. government, the Nikkei business daily reported.
-- Nintendo Co Ltd
Nintendo said on Wednesday the launch of its 3D-capable DS handheld game player will miss the busy year-end holiday shopping season, forcing Japan's leading game machine maker to slash its full-year profit forecast by one-third.
-- Toshiba Corp
Toshiba said on Wednesday it is aiming for a more than 10 percent share of the rechargeable battery market in five years, eyeing a sizable chunk of the surging but competitive sector.
-- Fuji Electric Holdings
Fuji Electric said on Wednesday it would postpone setting up a joint venture with General Electric to produce electric metres in Japan due to a delay in clearing antitrust checks.
-- Mitsubishi Motors
Mitsubishi Motors said on Wednesday it has agreed with PSA Peugeot Citroen to jointly develop electric versions of two models, the Peugeot Partner and the Citroen Berlingo. (Reporting by Aiko Hayashi; Editing by Michael Watson)