Nikkei up, boosted by techs as financials falter

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By Elaine Lies

TOKYO, Feb 12 (Reuters) - Japan's benchmark Nikkei edged up in seesaw trade on Tuesday, as gains in TDK Corp (6762.T: Quote, Profile, Research, Stock Buzz) and other technology shares outweighed downward pressure from financial shares sold on U.S. credit fears. Yahoo Japan rose 1.1 percent after Yahoo Inc (YHOO.O: Quote, Profile, Research, Stock Buzz) rejected Microsoft Corp's (MSFT.O: Quote, Profile, Research, Stock Buzz) takeover bid as too low, raising the possibility of a higher offer [ID:nN11617754].

But the market was unable to completely ignore the downward pressure of financial shares as investors worried about a possible downgrade of U.S. bond insurers such as MBIA Inc (MBI.N: Quote, Profile, Research, Stock Buzz).

"There's been talk for a long time that a ratings cut decision on the monoline firms was due in mid-February, and we're almost there now," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.

"Even though people know this is likely to happen, and when, the fact is that there is still quite a lot of worry out there about the issue."

More downward impetus came from American International Group Inc (AIG.N: Quote, Profile, Research, Stock Buzz), which disclosed potential losses in its derivatives portfolio, raising fears it would become the latest casualty of the credit crisis. [ID:nN11631855]

The combination hit insurers hard, with Millea Holdings Inc (8766.T: Quote, Profile, Research, Stock Buzz), Japan's largest non-life insurer, tumbling 4.5 percent and other insurers skidding even further.

But high-tech shares fought back, bolstered by gains in their peers on Wall Street.