JGB futures rise as stocks turn negative

By Chikako Mogi

TOKYO, April 24 (Reuters) - Japanese government bond futures rose on Thursday as Tokyo share prices turned negative, but cash bond prices were mixed, reflecting investor caution ahead of key events.

Investors were looking for fresh incentives to trade on, having adjusted their bets and unwound distorted positions after a volatile couple of months, traders said.

As market fears about a global credit market crisis eased, investors took profits on a plunge in yields, bringing them back up towards levels that appear to reflect the view that the Bank of Japan will keep interest rates steady for several months, they said.

"Investors now need fresh incentives to either buy or sell," said Koji Ochiai, senior market analyst at Mizuho Securities.

"The expensive 7- to 10-year zone of the curve has been corrected with the recent selling so investors can't sell these maturities. But they also have no strong reason to buy aggressively," he said.

He added that the market direction was likely to be dictated by stocks or currency market moves.

Some traders said investors were waiting for the Federal Reserve's policy decision next week and key U.S. jobs data also due next week, as well as the BOJ's policy meeting and twice-yearly outlook on prices and growth due on April 30.

Ochiai said he expected the BOJ to acknowledge the current weak fundamentals but maintain its view that the positive cycle of production and consumption is intact, keeping alive expectations for an eventual rate increase.