Nikkei slips for sixth day after BOJ holds fire

Tue Apr 10, 2012 2:53am EDT

* Nikkei erases early gains after BOJ stands pat
    * Benchmark logs longest losing streak since July 2009
    * Receding yen strength provides support
    * Sharp falls on report to post wider net loss

    By Mari Saito	
    TOKYO, April 10 (Reuters) - Japan's Nikkei share average
fell for a sixth straight day on Tuesday, if only by 0.1
percent, after the Bank of Japan decided against additional
easing measures at its policy meeting. 	
    The yen, which strengthened slightly on the announcement,
provided support to exporters that had been heavily sold.	
    The benchmark Nikkei ended down 8.24 points at
9,538.02, marking its longest losing streak since July 2009. 	
    The index remained above its 50 percent retracement of its
fall from February to November last year near 9,511, seen as a
technical support level. 	
    Strategists said the BOJ's decision to keep monetary policy
steady was expected, but there was selling among disappointed
investors who had hoped for some asset-buying similar to the
bank's action in February. 	
    "Despite the overall market expectation that the BOJ would
not act at their meeting today, there was still some
anticipation in the morning and you can see those gains now
reversing," said Eiji Kinouchi, chief technical analyst at Daiwa
Securities.	
    Market participants widely expect the central bank to expand
its asset-buying programme and take other measures to support
the economy when it issues its economic outlook and price
forecasts on April 27. 	
    The broader Topix index was off 0.03 percent at
813.43.	
    "It is not like the market is going to continue to fall on
the news from BOJ," said Makoto Kikuchi, CEO of Myojo Asset
Management, adding that the focus had now turned to U.S.
corporate earnings this week.	
    U.S. aluminum giant Alcoa Inc will kick-start the
Wall Street earnings season later in the day, followed by
financial heavy weights JP Morgan Chase & Co and Wells
Fargo & Co later this week.	
    "There are still plenty of investors globally who are
looking to buy Japan after a correction... But any chance of
testing the upside on expectations for Japan's corporate
earnings recovery will only last to the end of this month," said
Kikuchi. 	
    In Tokyo, exporters were still in demand, with Toyota Motor
Corp, Honda Motor Co and Nissan Motor Co
 up between 0.5 and 1.5 percent.	
    Sharp Corp shed 4.3 percent after a Nikkei report
said the electronics maker was expected to post a wider net loss
for the 2011 fiscal year than previously projected, hurt by poor
sales of televisions and solar cells. 	
    A source also told Reuters on Tuesday that Sharp was seeking
more partners to buy stakes in its main LCD production facility
in western Japan in a bid to spin off the subsidiary.  	
    "The overall feedback from long-term investors is that there
is no long-term story in place which can justify taking a two-to
three-year position on Sharp," a dealer at a foreign bank said.	
    Trading volume rose, with 1.9 billion shares changing hands
on the main board, up f rom 1.6 billion shares on Monday. 	
    	
    SHORT AUTOS 	
    The auto sector outperformed the broader market but Nomura
recommended investors short the sector, citing a halt in yen
weakness.	
    "With the market's risk-on sentiment fading, we think
high-beta sectors including automobiles and transport equipment
could see spreading profit-taking in the near term," it said in
a report.	
    "Although sector valuations continue to look relatively low,
we have lowered our stance on the sector to short in view of a
halt in yen depreciation, with which sector performance is
closely correlated, and of signs from a technical perspective
that the sector could soon enter a correction phase."	
    The transport equipment sub-index, home to Toyota
and Nissan, rallied 32 percent in January-March, outperforming a
19.3 percent rise in the Nikkei, although it is down 6.2 percent
since the start of April.	
    Financials also bounced, with Mitsubishi UFJ Financial Group
Inc gaining 0.8 percent in heavy volume, while Japan's
top investment bank, Nomura Holdings Inc, climbed 0.8
percent, lifted by a target price hike by Bank of America
Merrill Lynch.