Nikkei edges down as exporters weigh, Nissan up

* Exporters drag on Nikkei as investors take profits

* Nissan climbs after switching guidance to profit

TOKYO, Nov 5 (Reuters) - Japan's Nikkei average lost 0.5 percent on Thursday with Canon Inc (7751.T) and other exporters slipping as investors took profits, though gains in banking shares helped keep the market supported. But Nissan Motor Co (7201.T) rose after Japan's third-biggest automaker revised its annual outlook to a profit from a loss on Wednesday as soaring sales in China helped drive quarterly earnings beyond market expectations. [ID:nT127974]

As expected, the Federal Reserve reiterated its intent to keep interest rates low on Wednesday. Though Wall Street rallied in response it soon lost steam, with investors turning their eyes to jobs data due out on Friday.

"A lot of investors are likely to be stay on the sidelines ahead of the jobs data, given that the September figures were worse than expected, and this is likely to keep stocks weak until then," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.

The private-sector jobs report by ADP Employers Services showed companies cut 203,000 jobs in October, fewer than the revised 227,000 in September and the lowest since July 2008. [ID:nNo4349022]

Analysts polled by Reuters expect Friday's employment report to show that U.S. payrolls shrank by 175,000 and the unemployment rate hit a new 26-year-high of 9.9 percent in October.

The benchmark Nikkei .N225 lost 45.65 points to 9,798.66, while the broader Topix shed 0.2 percent to 879.59.

Market players said investors were also likely to be less active as they waited for earnings of big name companies such as Toyota Motor Corp (7203.T), which will announce its results after the market closes on Thursday.

The Fed's closely watched policy statement was somewhat more upbeat than its statement in September but it was also more explicit about why it expects to keep rates low, citing "low rates of resource utilisation, subdued inflation trends, and stable inflation expectations".

Wall Street rallied after the Fed statement but lost steam, with the Dow .DJI up 0.3 percent, the S&P 500 .SPX up 0.1 percent and the Nasdaq .IXIC down 0.1 percent. [.N]

"The Fed results were basically as expected, but with jobs data coming up, U.S. shares were vulnerable to profit-taking," said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

"The Nikkei is now low enough that it's appealing to buyers, so there's no fear that it will fall much, but energy is dropping along with volume."

Nissan gained 2.4 percent to 678 yen after the company, owned 44 percent by Renault SA (RENA.PA), said it now expects an operating profit of 120 billion yen ($1.3 billion) in the year to March, instead of the 100 billion yen loss it had forecast previously.

Earnings remained a focus for investors, with raised forecasts helping to boost shares.

Sumitomo Heavy Industries (6302.T) rose 4.6 percent to 434 yen after it raised its full-year operating profit forecast by a third, helped by a smaller-than-expected rise in steel costs and an easing of product price falls.

Canon fell 0.6 percent to 3,380 yen and fellow exporter Sony Corp (6758.T) lost 1 percent to 2,580 yen. Honda Motor Co (7267.T) lost 1.8 percent to 2,810 yen.

But these losses were countered by gains in banking shares on short-covering, with top lender Mitsubishi UFJ Financial Group (8306.T) rising 1.7 percent to 488 yen and No.3 bank Sumitomo Mitsui Financial Group (8316.T) rising 1.3 percent to 3,150 yen. (Reporting by Elaine Lies; Editing by Michael Watson)