* Upper house election result awaited * Mitsubishi Motors soars on dividend hike report By Ayai Tomisawa TOKYO, July 17 Japan's Nikkei share average fell on Wednesday as weakness in global markets and the strong yen soured sentiment, with investors also cautious ahead of the U.S. Federal Reserve chairman's appearance before Congressional committees. The Nikkei dropped 0.8 percent to 14,486,27 in mid-morning trade, with a support level seen at 14,400. The dollar dropped 0.70 percent to 99.14 yen on Tuesday on expectations that Bernanke's testimony will reiterate that U.S. monetary policy will remain extremely accommodative. Exporters led the declines, with Advantest Corp falling 2.9 percent, Nikon Corp dropping 1.7 percent and Sony Corp shedding 0.6 percent. Bucking the weak trend, Mitsubishi Motors Corp soared more than 10 percent after the Nikkei said the carmaker will likely pay out 30 to 40 percent of its profit to shareholders for the year through March. Market analysts said that with some technical signs starting to show that the Nikkei would soon be overbought, a temporary correction is possible. The Nikkei is currently trading 6.2 percent above its 25-day moving average of 13,644.33. "Investors are staying on the sidelines before the big events. They hesitate to take large positions before (Federal Reserve Chairman Ben) Bernanke's testimony and Japan's upper house election," said Toshihiko Matsuno, a senior strategist at SMBC Friend Securities. "Investors are focused on when the Fed will scale back stimulus, and while the LDP's victory is widely expected, they want to see the results before they bet on anything." The Topix shed 0.2 percent to 1,208.15. Prime Minister Shinzo Abe's Liberal Democratic Party-led bloc is expected to win a hefty majority in the upper house election on July 21, ending a "twisted parliament" in which the opposition controls the upper chamber. "Since an LDP/Komeito majority is widely expected by investors, the net impact on the equity market would be neutral, or potentially positive if the LDP wins a landslide victory," Goldman Sachs wrote in a report. "If, however, the LDP/Komeito parties secure less than 64 seats, investors are likely to be disappointed since the 'twisted Diet' situation would persist, making legislation passage difficult." Market players said the market would shift its focus to fundamentals after the election. April-June earnings are likely to show solid results on factors such as improving domestic economic conditions, recovery of U.S. demand, and depreciation of the yen against the dollar since the same quarter last year. "I expect that autos, electronics and semiconductor manufacturing equipment makers will benefit from such good factors," said Yutaka Yoshino, chief technical analyst at Nikko Cordial Securities. "Some of these stocks have outperformed the market even during the Nikkei's correction phase in June, and these companies will likely continue outperforming." The Nikkei has fallen 9.1 percent from this year's peak of 15,942.60, but is still up 40 percent this year.