Nikkei likely to rise, stronger yen may cap gains

TOKYO, March 19 (Reuters) - Japan's Nikkei average is likely
to rise on Thursday, boosted by a rally in U.S. stocks after the
Federal Reserve decided to buy long-dated Treasuries, with
financial shares such as Mitsubishi UFJ Financial Group <8306.T>
expected to gain.
But gains are likely to be capped as a stronger yen
could prompt investors to sell Honda Motor Co <7267.T> and other
exporter shares.
"The Tokyo stock market is likely to receive firm support
from gains on Wall Street," said Toshiyuki Kanayama, market
analyst at Monex Inc. "Few had expected the Fed to go ahead with
Treasury buying and that should have an impact on share prices
here, as well."
U.S. stocks climbed on Wednesday after the Fed surprised Wall
Street when it said it would buy long-term Treasury bonds for the
first time in four decades in an effort to revive the
recession-hit economy.
Market participants expect the benchmark Nikkei <.N225> to
move between 7,900 and 8,200 on Thursday.
The Nikkei edged up 0.3 percent on Wednesday to end at
7,972.17, its highest close since Feb. 6. The Nikkei has risen
nearly 800 points or 11 percent in the past four trading days.
Nikkei futures traded in Chicago <2NKc1> closed at 8,065
compared with the Osaka close of 7,920 , pointing to a
higher opening.

----------------------MARKET SNAPSHOT @ 2315 GMT ------------
INSTRUMENT LAST PCT CHG NET CHG
S&P 500 <.SPX> 794.35 2.09% 16.230
USD/JPY 96.23 0.26% 0.250
10-YR US TSY YLD 2.5472 -- 0.000
SPOT GOLD 937.15 -0.30% -2.850
US CRUDE 49.5 2.83% 1.360
DOW JONES <.DJI> 7486.58 1.23% 90.88
-------------------------------------------------------------

> Wall St jumps as Fed spurs optimism, Oracle up late [.N]
> Dollar plunges as Fed says will buy Treasuries [USD/]
> Treasuries rally after Fed says will buy bonds [US/]
> Gold bounces on inflation fear, weak dlr after Fed [GOL/]
> U.S. oil prices near $50 in post-settlement trade [O/R]

STOCKS TO WATCH
-- Toyota Motor Corp <7203.T>
Toyota has decided to cut its hiring plans for the fiscal
year beginning next month to reduce costs amid slumping global
sales, the Nikkei newspaper reported. [nN18379640]
-- Toshiba Corp <6502.T>
Toshiba has tapped Norio Sasaki as its new chief executive,
entrusting the experienced head of its power division with a $3
billion cost-cutting plan as the electronics giant heads for a
record loss. [nT372112]
-- Hoya Corp <7741.T>, Showa Denko <4004.T>
Hoya Corp said on Wednesday it would end talks with Showa
Denko to set up a joint venture to combine their hard-disk media
businesses because of a worsening business climate.
-- Hokuriku Electric Power Co <9505.T>
Japan's Nagoya High Court on Wednesday backed continued
operation of a nuclear reactor owned by Hokuriku Electric,
overturning a lower court decision backing a bid by nearby
residents. [nT72048]
-- Nissan Motor Co Ltd <7201.T>
Nissan sees 2009 sales volumes in Asia Pacific outside Japan
at least holding steady, if not growing -- one relatively bright
spot in an otherwise tough year ahead. [nSIN301544]
--Aeon Co Ltd <8267.T>
Aeon, Japan's second-largest retailer, is marking down prices
of 3,400 national brand items by 20 to 35 percent, extending a
discounting wave as top store chains seek to attract increasingly
price-sensitive shoppers. [nT366566]
(Reporting by Rika Otsuka; Editing by Chris Gallagher)
((rika.otsuka@thomsonreuters.com; +81-3-6441-1874; Reuters
Messaging: rika.otsuka.reuters.com@reuters.net))

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Keywords: MARKETS JAPAN STOCKS

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