Nikkei expected to rebound on short-covering on exporters
TOKYO, Feb 27 (Reuters) - Japan's Nikkei share average is expected to rebound on Wednesday after falling sharply on the previous day, as investors buy back export-oriented stocks after hopes for continuing Federal Reserve stimulus boosted Wall Street. Market players said the Nikkei was likely to trade between 11,300 and 11,500 after dropping 2.3 percent to 11,398.81 on Tuesday on concerns an inconclusive election in Italy could reignite the euro zone debt crisis. The index touched a 53-month high on Monday. Nikkei futures in Chicago closed at 11,375, down 0.3 percent from the close in Osaka of 11,410. Analysts said Italy's election outcome has dampened sentiment, but Japanese shares were supported by hopes the government will nominate Asian Development Bank President Haruhiko Kuroda, an advocate of monetary easing, as its next central bank chief. "Even if there are negative factors from overseas continuting to hurt sentiment, the Nikkei should be supported above its 25-day moving average (of 11,170) for the time being," said Yutaka Miura, a senior technical analyst at Mizuho Securities. "For today, short-covering may lift the market especially from buying in exporters and financials." U.S. stocks climbed as Federal Reserve Chairman Ben Bernanke strongly defended the Fed's bond-buying stimulus, easing worries that policymakers might be getting cold feet about continuing the extraordinary measures to support the economy. In Europe, a closely watched gauge of European stock market volatility hit a 2013 high after the muddy election outcome in Italy raised fresh concern about the outlook for the euro zone's debt crisis. > Wall Street rebounds on Bernanke comments, data > Euro flat after seesaw session; Bernanke defends bond buying > Yields near 1-month lows as Bernanke defends bond buys > Gold gains most in 3 months as Bernanke defends policy > Brent crude oil drops under $113 on Italian vote fears STOCKS TO WATCH --Itochu Corp Itochu will form a partnership with European oil trading house Vitol Group to export liquefied petroleum gas from the United States to Japan, the Nikkei reported citing unnamed company sources.
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