Japan's Nikkei recovers early losses, Nissan jumps
* Nissan, Sumitomo Metal Mining up as guidance cut less than feared * DeNA rises after H1 earnings beat own guidance By Dominic Lau TOKYO, Nov 7 (Reuters) - Japan's Nikkei recouped early losses on Wednesday, with Nissan Motor Co and Sumitomo Metal Mining rallying after they cut their earnings forecast less than feared and as the market priced in the re-election of U.S. President Barack Obama. Obama rolled to a second term in the White House over Republican challenger Mitt Romney, who was deemed by many in the markets as pro-business. The Nikkei ended down 2.26 points, or 0.03 percent, to 8,972.89 after falling as much as 0.6 percent at the start of the afternoon session as the expectations of an Obama victory gathered momentum. "It started to price in in the late morning, before the morning close ... net-net there is no change on flows otherwise," a dealer at a foreign bank said. But gains in the likes of Nissan and Sumitomo Metal Mining helped the index to claw back losses. The benchmark Nikkei is up 6. 1 p ercent this year, trailing a 13.6 percent rise in the U.S. S&P 500. Nissan climbed 4.1 percent and Sumitomo Metal Mining surged 6.2 percent, while a 1.9 percent gain in social gaming company DeNA Co Ltd, after its first half operating profit beat its own guidance, also lent support to the market. Company quarterly earnings have been weak so far this reporting season, with 59 percent of the 119 Nikkei companies that have released their quarterly results undershooting market expectations, according to Thomson Reuters StarMine. That compared with 54 percent in the previous quarter. "Broadly, they were slightly weaker than I had expected. After the U.S. elections, there is not much catalyst going forward in the next couple of months. Under such an environment, I would not be surprised that the market will see a small correction," said Hidehiro Tomioka, head of equity investment at Manulife Asset Management in Tokyo. "It is at the high-end of recent trading range ... We may see some correction to 8,500 in the near-term, a short-term correction, a healthy one." Among the companies that reported disappointed earnings was engineer Chiyoda Corp, which dropped 4.8 percent after it announced its first-half results during Wednesday's lunch break. Taiyo Yuden CO Ltd slumped as much as 11.2 percent to a three-month low after the electronic parts maker slashed its full-year operating estimate by 50 percent to 5 billion yen. The stock ended 2.8 percent lower. The broader Topix added 0.1 percent to 745.71 in relatively active trading, with volume 16 percent above its daily average for the past 90 trading days. Global investors would be keen to see the 'fiscal cliff' in the United States to be resolved after the presidential election. If not, about $600 billion in government spending cuts and higher taxes are set to kick in from Jan. 1, which could push the U.S. and possibly the global economy back into recession. "Now the market's attention is how the new U.S. leader will deal with its fiscal policy," said Kenji Shiomura, a markets analyst at Daiwa Securities.
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