Nikkei set to rise, test 200-day moving average
TOKYO, Nov 19 (Reuters) - The Nikkei average is expected to open higher on Monday on growing expectations that Japan's main opposition party will win next month's election and increase pressure on the central bank to ease monetary policy. A call by Liberal Democratic Party (LDP) leader Shinzo Abe for the Bank of Japan to further stimulate the ailing economy, including setting interest rates to zero or below zero, has weakened the yen and boosted the shares of Japanese exporters. The yen was trading at 81.43 yen to the dollar on Monday, near a 6-1/2-month low of 81.465 hit on Thursday. A weaker yen allows exporters to earn more when they repatriate overseas earnings, as well as boosting their competitiveness. The Nikkei was likely to trade between 9,000 and 9,150 on Monday, strategists said, after rallying 4.2 percent in the previous two sessions. Nikkei futures in Chicago closed at 9,090 on Friday, up 0.9 percent from the Osaka close of 9,010. "The market's bullish sentiment will continue today," said Takashi Hiroki, chief strategist at Monex Inc. Hiroki said sentiment had changed as trading volume hit an eight-month high on Friday and any short-term profit-taking would likely to be limited. "Today's point is whether the Nikkei will break above the 200-day moving average (at around 9,072)," he said. A public opinion poll showed on Sunday that the LDP has maintained its lead over the ruling party, strengthening its case to reclaim control of the government in the December election after a three-year absence. On Friday, the Nikkei climbed 2.2 percent to 9,024.16, hitting a two-week closing high. The broader Topix advanced 1.9 percent to 751.34. The benchmark Nikkei is up 6.7 percent this year, slightly trailing an 8.1 percent rise in the U.S. S&P 500 and a 7.5 percent gain in the pan-European STOXX Europe 600 index. > Washington's positive tone cheers Wall St for a day > Yen steadier after hammering, still fragile > Treasuries on U.S. budget talks, Israel worries > Gold down for week on recession, fiscal crisis fears > Oil rises on Middle East conflict, Gulf of Mexico fire STOCKS TO WATCH --JAPAN TOBACCO INC Japan's Ministry of Finance said on Friday it would not sell shares in Japan Tobacco before the end of December, delaying the raising of funds for rebuilding areas hit by last year's earthquake and tsunami. Separately, the company said on Friday it will buy Egypt's Al Nakhla Tobacco Company, a maker of waterpipe tobacco, for an undisclosed sum. --KOMATSU LTD Komatsu and China's Sinomach are to battle it out to buy German machine tool maker MAG Group, three sources familiar with the sale process told Reuters on Sunday. --HOYA CORP, SEIKO EPSON CORP Hoya said on Friday it will take control of Seiko Epson's eyeglass lens development and manufacturing business as part of a partnership to expand sales of eyewear products globally. --NIDEC CORP Nidec is interested in Finmeccanica's power engineering unit AnsaldoEnergia and is ready to invest 1 billion euros ($1.27 billion) to expand its presence in Europe, president Shigenobu Nagamori told Il Sole 24 Ore on Saturday.
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