Nikkei slips as chipmakers fall; property surges

* Chip shares drag Nikkei lower, but 10,000 line solid

* Property shares gain on sector upgrade

* SMFG slides after report on planned share issue

* Largely directionless, awaiting U.S. indicators

By Elaine Lies

TOKYO, June 15 (Reuters) - Japan's Nikkei stock average slipped 0.7 percent on Monday, dragged lower by chipmakers after disappointing guidance from a U.S. peer as investors searched for clear signs that the economic recession may be easing.

But falls were checked by gains in property developers such as Sumitomo Realty & Development (8830.T) after Daiwa Institute of Research hiked its rating on the real estate sector to "neutral" from "underweight", citing ongoing improvement in credit markets and global confidence.

Market analysts said shares were taking a breather after closing above 10,000 on Friday for the first time in eight months, with investors focused on U.S. indicators due out later this week.

"We've verified that markets have bottomed out but we have yet to see what sort of form the recovery will take and we need clear proof that it will continue," said Masayoshi Okamoto, head of trading at Jujiya Securities.

"But now that the market's hit 10,000, there are a lot of people who want to sell to take profits ahead of the U.S. indicators later this week."

U.S. May housing starts, producer prices and industrial production are set to be released on Tuesday, with consumer prices coming out on Wednesday.

Markets will also be watching a summit of leaders from Russia, China, India and Brazil -- the producers of 15 percent of global output -- to be held in Russia on Tuesday. [ID:nLB596662]

"Last week, the market gained on positive news such as Chinese industrial production figures, which make it hard to deny that the global economy is improving," said Kazuhiro Takahashi, general manager of equities at Daiwa Securities SMBC.

"There are a number of U.S. indicators due out later in the week, which the market will use to confirm trends. But today, there won't be a lot of direction."

The benchmark Nikkei .N225 shed 67.79 points to 10,068.03 after closing above 10,000 on Friday for the first time in eight months. The broader Topix was flat at 950.50.

CHIPS CRUMBLE, PROPERTY POWERFUL