Nikkei rebounds on bargain hunting; Ukraine concerns still weigh
* Nikkei rises 0.3 pct, Topix up 0.4 pct * Volume low as investors await key events, look to Ukraine * Real estate companies best performers on short covering By Tomo Uetake TOKYO, March 4 (Reuters) - Japan's Nikkei average clawed higher on Tuesday morning after four days of losses as some foreign investors scooped up battered shares, although concerns over mounting tensions in Ukraine kept the market on edge. The Nikkei was up 0.3 percent at 14,698.52 by the midday break, after initially falling as much as 0.7 percent. After jumping 57 percent in 2013, the benchmark is down almost 10 percent so far this year, making it one of the worst performers in the developed world. "I thought the market would fall more but some long-only investors were buying near 15,000 in the Nikkei today, bidding relatively cheap shares," said Kyoya Okazawa, the head of global equity and commodity derivatives at BNP Paribas in Tokyo. "Investors seem to think that Russia will take Crimea and the West will impose sanctions on Moscow but there will likely be no military clash," he added. Also underpinning Tokyo shares was the perception that the Bank of Japan is likely to increase its stimulus to bolster the economy, should it deteriorate. Still, trading was thin as many investors held off making new moves given the precarious conditions in Ukraine. Trading in Nikkei futures was briefly halted in late morning trade for more than 20 minutes. The Osaka Securities Exchange said is looking into the cause of the stoppage. "Fears over Ukraine have heightened and could affect not only emerging markets but also the global economy, including that of Japan," Tohru Sasaki, head of Japan rates and FX research at JPMorgan, said in a note to clients. "If the situation in Ukraine deteriorates further, it would send stock prices lower around the world, push down long-term interest rates and strengthen the Japanese yen." The U.S. State Department said Washington was preparing to impose sanctions on Russia for its intervention in Ukraine, although no decisions had yet been made, while Ukraine's acting president said Russia's military presence in Crimea was growing. Investors were also looking to key events later this week and next, including the latest U.S. nonfarm payrolls report, China's annual parliamentary meeting and a Bank of Japan policy meeting. Real estate developers were the best performers on Tuesday, with the sector's subindex up 2.7 percent on short covering after their underperformance in recent weeks. The index is still down almost 20 percent this year. Sumitomo Realty & Development rose 3.2 percent and Mitsubishi Estate rose 2.9 percent. Nikkei heavyweight Fast Retailing rose 1.4 percent after its domestic Uniqlo sales in February rose 0.8 percent from a year earlier despite heavy snowfall. The broader Topix index was up 0.4 percent at 1,201.58 in subdued trade, with volume at 38.3 percent of the full daily average for the past 90 trading days as of midday. The JPX-Nikkei Index 400, an index launched this year comprising firms with high return on equity and strong corporate governance, rose 0.4 percent to 10,874.09.
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