JGBs rise on Nikkei's slide, eyes on 10-yr auction

* JGBs rise on Nikkei's 4.6 pct drop, U.S. bond rally

* Gains limited ahead of 10-year JGB auction

* BOJ holds emergency meeting to discuss corporate finance

* Repo rates dip, BOJ offers to buy Y5 trln in JGBs via repos

By Masayuki Kitano

TOKYO, Dec 2 (Reuters) - Japanese government bonds edged higher on Tuesday, buoyed by a slide in Tokyo share prices and an overnight rally in U.S. Treasuries, but gains were limited ahead of a 10-year bond auction.

The Nikkei share average dropped 4.6 percent .N225, bolstering demand for safe-haven government debt, and JGBs were also supported after the U.S. 10-year Treasury yield sank to 50-year lows the previous day. [.T] [US/]

Market players were awaiting the results of the Ministry of Finance's auction of 1.9 trillion yen ($20.38 billion) in 10-year JGBs due later on Tuesday.

The new 297th issue was offered with a coupon rate of 1.4 percent, down from 1.5 percent at the previous 10-year auction in November.

"It will be interesting to see just how much demand there is from investors at a time when market liquidity is low," said Shinji Ebihara, a quantitative analyst at Mizuho Securities.

A dealer for a Japanese brokerage house said it was hard to tell how the auction would go. "Views on this are divided," he said.

Market players will also be watching the Bank of Japan's emergency policy meeting to discuss measures to help corporate finance.

The lead December 10-year JGB futures contract rose 0.31 point to 139.70 2JGBv1. A rise above 140.10 would take JGB futures to an 11-week high.

The 296th 10-year JGB yield fell 3.5 basis points to 1.365 percent JP10YTN=JBTC.

The BOJ policy board will hold a meeting from 0400 GMT to discuss measures to help corporate finance, and BOJ Governor Masaaki Shirakawa will hold a news conference from 0630 GMT.

If the BOJ unveils any measures that help to alleviate upward pressure on longer-end money market interest rates, that could lend support to short-term JGBs, said Ebihara at Mizuho Securities.

JGB repo rates eased after the BOJ offered to buy a total of 5.0 trillion yen in JGBs via repos for a second straight day, market players said.

The central bank's offer on Monday to buy 5.0 trillion yen in JGBs via repos had been the biggest one-day announcement for an operation of that type since the BOJ scrapped its quantitative easing policy in March 2006, and Tuesday's offer matched that amount.

The 5.0 trillion yen in JGB buying via repos offered on Tuesday included 4.0 trillion yen in repos for a 1-day period starting Thursday. The pro-rata rate at that operation fell to 0.210 percent, far below 0.460 percent at a similar 1-day repo operation last Wednesday.

Market rates for JGB repos also dipped compared with last week, with JGB repo rates for a 1-day period starting Thursday standing around 0.35 percent, said a trader for a Japanese money broker. (Editing by Chris Gallagher)