Nikkei rises to 1-week high on Wall Street gains; BOJ awaited

Mon Jul 14, 2014 9:50pm EDT

* A cut in BOJ growth view may add to expectations for
easing - analysts
    * All of Topix's 33 subsectors rise
    * Fed Chair Janet Yellen's testimony awaited
    * Otsuka soars on new drug application to FDA

    By Ayai Tomisawa
    TOKYO, July 15 (Reuters) - Japan's Nikkei share average
climbed on Tuesday with all sectors rising, helped by gains on
Wall Street on Citigroup's strong earnings and a merger and
acquisition deal in the healthcare industry.
    The market was awaiting the outcome of the Bank Of Japan's
policy meeting later in the day.
    The BOJ is set to maintain its stimulus programme and its
projection that inflation will approach its 2 percent target
next year, though it may slightly cut its economic growth
forecast. 
    The Nikkei gained 0.9 percent to 15,432.65 points by
mid-morning after rising as high as 15,441.54, the highest since
July 7.
    Investors are focused on BOJ Governor Haruhiko Kuroda's
speech after the meeting. Analysts said that if he cuts this
year's economic growth forecast, it may reinforce market
expectations that the central bank will have to launch more
monetary easing later this year.
    "A direct short-term impact to the stock market (if Kuroda
cuts the growth view) should be limited as long as he keeps the
2 percent inflation target," said Hikaru Sato, a senior
technical analyst at Daiwa Securities.
    "But in the mid-term, expectations for monetary easing
during the second half of the year may rise."
    Investors were also awaiting U.S. Federal Reserve Chair
Janet Yellen's congressional testimony later in the day for
signs on when U.S. interest rates will rise.
    Exporters were strong, with Honda Motor Co rising
1.9 percent, Nikon Corp adding 1.2 percent and
Advantest Corp advancing 1.5 percent.
    Otsuka Holdings soared 2.3 percent after the
drugmaker and  H Lundbeck A/S submitted a new drug application
to the U.S. Food and Drug Administration for "brexpiprazolea", a
drug to treat schizophrenia and depression. 
    The broader Topix gained 0.9 percent to 1,276.33 and
the JPX-Nikkei Index 400 advanced 0.9 percent to
11,609.19.

 (Editing by Kim Coghill)
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