Nikkei flat as Softbank falls but resource shares up
(Adds stocks, comment)
By Aiko Hayashi
TOKYO, May 9 (Reuters) - The Nikkei share average was nearly flat on Wednesday, weighed down by Softbank Corp. (9984.T) after a brokerage rate cut, but the benchmark index was supported by resources shares such as metals.
Investors also became cautious before the outcome of a Federal Reserve interest rate-setting meeting on Wednesday, said Zenshiro Mizuno, senior managing director at Marusan Securities.
"The Nikkei is largely being dragged down by Softbank, but other shares are mostly moving on individual news," he said.
"Retail investors are shifting their money to major resource stocks as they have decided small-caps are completely hopeless."
Mizuno said Sumitomo Metal Mining Co. Ltd. (5713.T) was among the resource shares picked up on hopes for solid business outlooks.
The Nikkei .N225 finished the morning up 0.01 percent or 1.35 points at 17,658.19. The broad TOPIX index added 0.14 percent to 1,735.09.
Trade slowed with 1.03 billion shares changing hands on the exchange's first section. Declining shares beat advancers 872 to 672.
SOFTBANK FALLS, METAL STOCKS UP
Shares of Softbank lost 3 percent to 2,620 yen after UBS Securities cut its rating on the stock to "reduce 2" from "neutral 2", saying its share price is above the brokerage's price target of 2,350 yen.
Other analysts said Softbank's share price performance is at a peak after the Japanese Internet and telecom group posted sharp growth in annual earnings, thanks to contributions from the mobile unit it bought from Vodafone Group last year.
But Sumitomo Metal gained 3.1 percent to 2,795 yen, and Mitsui Mining and Smelting Co. Ltd. (5706.T) added 1.7 percent to 603 yen.
Sumitomo Metal had advanced 3.4 percent to 2,710 yen the previous session on speculation of further consolidation of non-ferrous metals producers follwoing news about Alcoa (AA.N).
Alcoa said it will make a hostile bid for its rival Alcan Inc. AL.TO AL.N of Canada for nearly $27 billion.
Among the losers, Sapporo Holdings Ltd. (2501.T), Japan's third-biggest brewer, which faces a possible takeover attempt by hedge fund Steel Partners, dropped 3 percent to 852 yen.
On Tuesday, it posted a group operating loss of 4.8 billion yen for the January-March first quarter, weighed down by sales promotion costs, roughly matching the loss it booked in the same period a year ago.
Among stocks that gained, Olympus Corp. (7733.T) advanced 3.3 percent to 4,340 yen after the precision equipment maker forecast an 8.4 percent rise in operating profit to 107 billion yen ($892 million) for the year that started last month, in what would be its third straight year of record profit.
Shares of Don Quijote Co. Ltd. (7532.T) surged 10.9 percent to 2,385 yen after the retailer posted better-than-expected third quarter results on Tuesday, prompting some brokerages to lift their ratings on the stock.
Shimano Inc. (7309.OS) climbed 4.2 percent to 4,020 yen after it raises its group net profit forecast for the first half to June 30 and full year to Dec. 31, citing strong sales of bicycle parts amid a relatively mild winter worldwide.
