Nikkei to trade narrowly, financials under pressure

TOKYO, April 7 (Reuters) - Japan's Nikkei stock average is
set to trade narrowly on Tuesday, with financial shares such as
Mizuho Financial Group (8411.T) under pressure after fears
re-emerged about the U.S. banking system.

Technology shares could also slip after sentiment in their
U.S. peers was bruised on worries about the potential collapse of
a takeover of Sun Microsystems (JAVA.O) after a source with
knowledge of the matter said talks with IBM (IBM.N) to acquire
its smaller rival broke down. [ID:nL6578542]

But market analysts said profit-taking was long overdue,
noting the Nikkei's sharp gains since hitting a bear market
closing low of 7,054.98 -- its lowest close since Oct 1982,
although they added that any slides are set to be limited.

"There's a sense in the market that it's gotten too high,"
said Hiroichi Nishi, general manager at the equity division of
Nikko Cordial Securities.

"How the market moves today depends on currencies. If the yen
strengthens, the market may be sold -- but only slightly, since
there's no real reason to sell sharply."

Bank shares slipped in the United States after a veteran
analyst warned banks still face fallout from excessive
risk-taking and warned of rising loan losses by the end of 2010.
[ID:nN06322858]

The dollar slipped 0.1 percent against the yen to 100.84 yen
JPY= which analysts said could leave exporters such as Canon
Inc (7751.T) vulnerable.

The benchmark Nikkei .N225 is likely to move between 8,700
and 8,900. It finished Monday trade up 1.2 percent at 8,857.93, a
three-month closing high, after late profit-taking pared earlier
gains.

Nikkei futures traded in Chicago 2NKc1 closed at 8,935
compared to the Osaka close of 8,890 JNIc1.

----------------------MARKET SNAPSHOT @ 2243 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG
S&P 500 .SPX 835.48 -0.83% -7.020
USD/JPY JPY= 100.87 -0.15% -0.150
10-YR US TSY YLD US10YT=RR 2.9316 -- 0.000
SPOT GOLD XAU= 870.95 0.25% 2.150
US CRUDE CLc1 51.32 0.53% 0.270
DOW JONES .DJI 7975.85 -0.52% -41.74
-------------------------------------------------------------
> Wall Street rally stumbles as bank fears reemerge [.N]
> US dollar advances broadly as global stocks fall [USD/]
> Bonds fall on concern over supply, Fed buying [US/]
> Gold slides with other commods, hits 10-week low [GOL/]
> Oil falls toward $51 tracking stock market [O/R]

-- Dentsu Inc (4324.T)

Dentsu, Japan's biggest advertising agency, said on Monday it
plans to book a 40.9 billion yen ($406 million) loss on its
shareholdings for the January-March quarter. [ID:nT136397]

-- Sony Corp (6758.T)

Sony's (6758.T) PlayStation 3 outsold Nintendo Co Ltd's
(7974.OS) Wii in March for the first time in 16 months in Japan
thanks to hot new PS3 titles from Sega Sammy (6460.T) and Capcom
(9697.T), a game magazine publisher said. [ID:nT66976]

-- Fast Retailing Co (9983.T)

Fast Retailing is set to team up with Chinese e-commerce firm
Alibaba to launch online sales of its popular Uniqlo brand casual
wear in China later this month, the Nikkei business daily said.

-- NTT DoCoMo Inc (9437.T)

NTT DoCoMo, Japan's biggest mobile phone operator, said on
Monday it would buy an unlisted direct marketing company for 31
billion yen ($308 million) to beef up its wireless e-commerce
business. [ID:nT130793]

-- Inpex (1605.T), Mitsubishi Corp (8058.T)

Oil and gas field developer Inpex, trading firm Mitsubishi,
and state-affiliate Japan Oil, Gas, and Metals National Corp
(JOGMEC) will pursue pursue a joint feasibility study with
Venezuela on the Orinoco oil belt in the coming two years, Energy
Minister Rafael Ramirez said at a signing ceremony in Tokyo.
[ID:nT154265]
(Reporting by Elaine Lies; Editing by Edwina Gibbs)