Nikkei steady as Olympic bid, US data eyed; auto shares up on strong US sales

Wed Sep 4, 2013 9:49pm EDT

* Auto sector gains on strong U.S. sales
    * Trading remains choppy ahead of macro data, Olympics
decision
    * BOJ expected to stand pat on policy

    By Ayai Tomisawa
    TOKYO, Sept 5 (Reuters) - Japan's Nikkei share average was
steady on Thursday morning as investors awaited key events this
week, including U.S. jobs data and a decision on Tokyo's bid to
host the 2020 Summer Olympics, while the auto sector
outperformed on the back of strong U.S. auto sales.
    The benchmark Nikkei was flat at 14,054.05 in
mid-morning trade, after rising as high as 14,140.20 at the
open, its highest level since Aug. 7. It later briefly dipped
into negative territory.
    "Strong car sales in the U.S. has again lifted market
confidence in its economy, and it lifted expectations that the
U.S. Federal Reserve will start cutting back its stimulus this
month," said Isao Kubo, an equity strategist at Nissay Asset
Management. "There is a sense of caution in the market."
    The broader Topix was flat at 1,156.55. 
    U.S. payroll data for August is due out on Friday and on
Saturday, a final decision on which city will host the 2020
Summer Olympics is expected. Tokyo is competing against Istanbul
and Madrid. Japan's revised second quarter GDP growth numbers
are also due out on Monday. 
    A recent run of strong U.S. data has reignited speculation
that the Federal Reserve will start to trim its bond-buying
programme - a major driver or riskier assets in recent years -
later this month. Friday's job's report is seen as a key to the
Fed's tapering timeline. 
    Automakers with high exposure to the U.S. market gained as
U.S. auto sales rose at their fastest pace in nearly six years
in August. Honda Motor Co gained 2.0 percent, Toyota
Motor Corp added 0.8 percent, and Fuji Heavy Industries
Ltd, which makes Subaru cars, advanced 1.0 percent.
    "Among auto stocks, Honda is benefiting the most on hopes
that the company's new model Fit will fare well in the U.S.,"
said Yoshihiro Okumura, an analyst at Chibagin Securities.
"Toyota's strength in America as well as Subaru's strong sales
were widely expected."
    On Thursday, the Bank of Japan, which launched a massive
monetary stimulus in April, is expected to maintain its policy
settings with indicators suggesting the programme is working.
    The index has surged 35 percent this year, underpinned by
the BOJ's and government's stimulus policies, but is 12 percent
below its May peak.
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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