Nikkei set to rise, eyes on currencies and GM

TOKYO, May 26 (Reuters) - Japan's Nikkei stock average is
likely to rise on Tuesday in thin trade, though exporters such as
Honda Motor Co (7267.T) could come under pressure should the yen
strengthen against the dollar.

Investors may focus on Canon Inc (7751.T) after its chief
executives said on Monday that its business has been doing better
than it expected in recent months, with stimulus steps by
governments around the globe gradually taking effect.
[ID:nT185301]

The market shrugged off Monday's nuclear test by North Korea,
with that and the subsequent reported launches of three
short-range missiles unlikely to affect trade. [ID:nN25330519]

"The Nikkei's 200-day moving average is currently coming in
at around 9,400. Should the Nikkei manage to break above this we
could see it rise fairly rapidly," said Nagayuki Yamagishi, a
strategist at Mitsubishi UFJ Securities.

"But if it tries this resistance and fails, we're likely to
remain locked in a fairly narrow range for a while."

Though the dollar was flat against the yen at 94.77 yen and
activity appeared to have settled down, any strong currency moves
could become a trading factor for stocks. JPY=

Investors are still waiting for news on the fate of General
Motors GM.N, which faces a June 1 deadline to work out issues
with its creditors if it wants to avoid a bankruptcy filing.

On Friday, a spokesman for some GM creditors said the
company's largest bond holders, with a total of roughly $27
billion in debt, plan to reject GM's current offer for a 10
percent equity stake. [ID:nN22369035]

The benchmark Nikkei .N225 is likely to move between 9,200
and 9,500. It closed at 9,347.00 on Monday.

Chicago Nikkei futures 2NKc1 were untraded due to a U.S.
holiday. Nikkei futures traded in Osaka JNIc1 closed at 9,340,
flat with Monday's Nikkei 225 close.
----------------------MARKET SNAPSHOT @ 2254 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG
S&P 500 .SPX 887 -0.15% -1.330
USD/JPY JPY= 94.74 -0.08% -0.080
10-YR US TSY YLD US10YT=RR 3.4495 -- 0.000
SPOT GOLD XAU= 955.65 -0.22% -2.150
US CRUDE CLc1 61.28 -0.63% -0.390
DOW JONES .DJI 8277.32 -0.18% -14.81
-------------------------------------------------------------
> European shares close higher in subdued trade [.L]
> Euro slips on German Ifo in thin holiday trade [USD/]
> Selloff persists on debt worries before supply [US/]
> Gold softens slightly, ETF holdings inch up [GOL/]
> Oil falls towards $61, OPEC cut unlikely [O/R]
STOCKS TO WATCH

-- Hokuriku Electric Power Co (9505.T), Hitachi Ltd (6501.T)

Hokuriku Electric plans to sue electronics maker Hitachi for
20.2 billion yen ($214 million) to cover oil and fuel costs
incurred after a Hitachi-made turbine failed, shutting down a
nuclear plant. [ID:nT178383]

-- Aderans Holdings (8170.T)

Japanese equity fund Unison Capital said on Monday it has
raised its planned offer for shares in wig maker Aderans by 20
percent to 1,200 yen per share.

Unison Capital and Aderans are locked in a battle with U.S.
hedge fund Steel Partners for shareholder votes at Aderans'
annual meeting scheduled for Thursday. [ID:nT142030]

-- Tokyo Electric Power Co (TEPCO) (9501.T)

TEPCO said on Monday it has boosted output from the
1,356-megawatt No.7 nuclear reactor at the quake-hit
Kashiwazaki-Kariwa plant in northern Japan to 50 percent of
capacity as part of a test run. [ID:nT20957]
(Reporting by Elaine Lies)