Nikkei dips 0.2 pct as drugs fall, Citi results eyed

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By Aiko Hayashi

TOKYO, April 18 (Reuters) - Japan's Nikkei stock average edged down 0.2 percent on Friday after a three-day winning streak, as investors moved to the sidelines ahead of earnings results from Citigroup (C.N: Quote, Profile, Research, Stock Buzz).

Exporters such as Canon Inc (7751.T: Quote, Profile, Research, Stock Buzz) rose on a softer yen and receding pessimism about U.S. corporate profits after Google Inc (GOOG.O: Quote, Profile, Research, Stock Buzz) reported solid earnings, while defensive issues such as drugmakers lost favour amid improving investor confidence.

"Investors in Tokyo actually don't want the market to gain too much today because after Citi's earnings the market could rally on short-covering," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management Co Ltd.

"While Citi is expected to report bad earnings, it probably has plans to boost its capital, and potential rescue plans might have been discussed at the Group of Seven meeting."

Analysts on average expect Citigroup, the largest U.S. bank, to post a quarterly loss close to $5 billion.

The benchmark Nikkei average .N225 fell 23.09 points to end the morning session at 13,375.21. It gained 3.7 percent over the past three days.

The broader TOPIX index shed 0.2 percent or 3.04 points to 1,290.28.