Nikkei set for ninth winning day on renewed yen weakness

By Sophie Knight
TOKYO, March 12 (Reuters) - Japan's Nikkei share average
rose in early trade on Tuesday, chalking up a fresh 4-1/2 year
high as a softer yen and expectations of monetary easing
continued to drive up financials and overlooked electronics
firms were bought up.
But the benchmark's advance was timid as signs of
overheating began to emerge as it headed for its ninth straight
day of gains, the longest winning streak since July 2009.
"I think the market's got a strong base but the Nikkei's
divergence from its 25-day moving average may signal a small
pullback coming up," said Kenichi Hirano, operating officer at
Tachibana Securities.
The benchmark was 7.3 percent above its 25-day moving
average after rising for eight consecutive days, its longest
daily winning streak since July 2009, when it rose for nine days
straight.
The Nikkei added 0.4 percent to 12,394.55 in early trade on
Tuesday, its highest level since early September 2008, while the
broader Topix also edged up 0.4 percent to 1,043.88.
Nippon Steel & Sumitomo Metal Corp jumped 4.8
percent after the corporation said it would halt a blast furnace
at a major steelworks in a bid to cut costs and resolve
overcapacity. The share helped the steel sub-index to
become the top sectoral gainer.
Japan Tobacco was also in focus after the
government, which owns a 50 percent stake in the cigarette
maker, cut the price of its share offer by 2 percent from
Monday's close. The stock fell 1.4 percent.
Exporters' gains were buttressed by a weaker yen, which
slumped to a new 3-1/2 year low in early Asian trade on media
reports that the Bank of Japan might deliver new stimulus
measures sooner than expected. Nissan Motor Co led
major automakers with a gain of 2.6 percent.
Analysts said the spotlight on exporters, financials and
real estate companies may become more diffuse as the Nikkei's
rally consolidates.
"Global funds, which have not yet wholeheartedly joined the
rally, tend to think of the bigger picture: they hear
'Abenomics' and they think of pricey real estate," said
Tachibana Securities' Hirano.
"But there are a lot of retail investors are going after
high-yield lesser-known names that aren't in the Nikkei."
BNP Paribas recommended investors buy banks which have
underperformed in the rally, such as regional lenders, as well
as Nikkei dividend futures to take advantage of current rally.
While mega-banks Mizuho Financial Group Inc,
Mitsubishi UFJ Financial Group Inc and Sumitomo Mitsui
Financial Group Inc gained between 0.9 and 1.8 percent
on Tuesday morning and were three of the top four most-traded
stocks on the main board, regional banks lagged.
Tsukuba Bank Ltd lost 2.3 percent while Bank of
Iwate and Hokuetsu Bank dropped 1.1 and 1.3
percent, respectively. Shimane Bank Ltd edged down 0.4
percent.
"Of course, banks are the obvious bet at the moment, but
there are a lot of other interesting stocks," said Takashi Oba,
senior strategist at Okasan Securities.
"There are a lot of investors just waiting for dips to swoop
in. Canon and Panasonic are zooming up today after being left
behind in the rally. Kyocera is getting a lot of play too."
Panasonic Corp shot up 7.6 percent after putting on
just 0.8 percent between February 15 and Monday, trailing the
Nikkei's gain of 10.5 percent in the same period. Canon Inc
advanced 3.4 percent and Kyocera Corp jumped
4.5 percent.