Nikkei seen boxed in range but set for best April in 20 years

TOKYO Mon Apr 29, 2013 7:15pm EDT

A man stands next to an electronic stock quotation board as cherry blossoms are in full bloom outside a brokerage in Tokyo March 25, 2013. REUTERS/Issei Kato

A man stands next to an electronic stock quotation board as cherry blossoms are in full bloom outside a brokerage in Tokyo March 25, 2013.

Credit: Reuters/Issei Kato

TOKYO (Reuters) - The Nikkei stock average is expected to tread in range on Tuesday, although it is heading for its best April performance in 20 years after the Bank of Japan stunned financial markets earlier this month with sweeping stimulus measures.

The Nikkei .N225 is likely to trade between 13,750 and 13,950, strategists said, while Nikkei futures in Chicago closed at 13,850 on Monday, down 0.7 percent from the Osaka close of 13,950 on Friday. Japanese markets were closed for a public holiday on Monday.

"The dollar/yen is trading in a stable manner, so Japanese equities will probably trade stably, too," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

The yen was quoted at 97.89 to the dollar in early Asian trade on Tuesday after rising to an almost two-week high of 97.35 on Monday.

On Friday, the Nikkei slipped 0.3 percent to 13,884.13, pulling back from a near five-year high, and the broader Topix .TOPX index dropped 1 percent to 1,161.19.

The benchmark Nikkei has risen 12 percent this month, on track for its best April performance since 1993.

It has surged 60 percent since mid-November, when Shinzo Abe, who became prime minister in December, promised expansionary monetary and fiscal policies to revive the world's third-largest economy. During the same period, the yen has weakened 22 percent against the dollar.

> S&P 500 closes at record, led by energy, tech shares .N > Euro up after Italy ends political chaos, ECB awaited <FRX/> > Treasuries firm as Fed meeting, payrolls data in focus <US/> > Gold up on cenbank stimulus hopes, eyes Fed meeting <GOL/> > Oil jumps stimulus hopes; U.S. export surge eyed <O/R>

STOCKS TO WATCH

- HONDA MOTOR CO (7267.T), MAZDA MOTOR CORP (7261.T)

Honda and Mazda expect to post vastly higher profits this financial year as they take advantage of export-friendly currency moves, but will face a fresh challenge: high costs of expansion.

- NOMURA HOLDINGS INC (8604.T)

Nomura reported its highest quarterly profit in seven years on Friday as Japan's largest brokerage cashed in on the surge in domestic shares and booked a one-off gain on the sale of a property affiliate's stock.

Separately, an Italian judge said in rejecting an assets seizure order against the Japanese bank that there was no evidence that Nomura made wrongful or disproportionate gains from its contentious derivative deal with Italy's Monte dei Paschi (BMPS.MI).

- SUMITOMO MITSUI FINANCIAL GROUP (8316.T)

Sumitomo Mitsui Banking Corp, a unit of Sumitomo Mitsui Financial Group, is in advanced talks to buy a $1.2 billion stake in BTPN, an Indonesian lender backed by TPG Capital, people familiar with the matter told Reuters.

Separately, Sumitomo Mitsui Financial Group, Japan's third-largest bank by assets, expects year-end net profit to rise 52 percent to a record high 790 billion yen ($7.9 billion) as a rally in domestic stock prices boosts earnings.

- ALL NIPPON AIRWAYS (9202.T), GS YUASA CORP (6674.T)

All Nippon Airways, the Japanese launch customer for Boeing Co's (BA.N) 787, flew its first Dreamliner in more than three months on Sunday to test reinforced batteries installed by the U.S. aircraft maker.

GS Yuasa is the battery maker for Boeing Dreamliner.

(Reporting by Dominic Lau and Lisa Twaronite; Editing by Chris Gallagher)