* Finance ministry to sell 600 bln yen, 30-yr bond Thursday
* China's June services sector growth at 9-mth low
TOKYO, July 3 Japanese government bond prices
rose slightly on Wednesday as a selloff in Asian equities on
concerns over slowing growth in China, Japan's second-biggest
export market, helped reverse mild early losses.
Asian shares extended their losses after a survey showed
that growth in China's services sector fell to its weakest pace
in nine months in June, adding to signs of a slowdown in the
world's second-largest economy.
The MSCI Asia-Pacific index excluding Japan
dropped 2.1 percent, though the Tokyo market outperformed with
the Nikkei easing 0.3 percent, supported by a weaker yen
against the dollar.
The 10-year yield was down 1 basis point at
0.880 percent after earlier rising to 0.90 percent.
It still remains trapped in the trading range of 0.80 to
0.90 percent seen over the past five weeks, stabilising from the
volatility that has buffeted trade just after the Bank of Japan
stunned financial markets with its promise to inject $1.4
trillion into the economy in less than two years on April 4.
Tadashi Matsukawa, head of Japan fixed-income at PineBridge
Investments, said growing political concerns in Brazil, Turkey
and Portugal as well as China's economic slowdown would help
support the JGBs.
Earlier, traders took advantage of the BOJ's bond-buying
operation to offload some of their holdings, ahead of a 30-year
debt auction on Thursday.
The BOJ offered to buy 950 billion yen ($9.5 billion) of
JGBs with residual maturities ranging from one to 10 years, as
part of its radical monetary easing steps to pull the world's
third-largest economy out of deflation.
"We will have the 30-year auction tomorrow, so there is some
position adjustment ahead of the auction. The BOJ operation was
not a surprise," said Naomi Muguruma, senior fixed-income
strategist at Mitsubishi UFJ Morgan Stanley Securities.
Ten-year JGB futures added 0.06 point to 142.35
after earlier trading as low as 142.18.
The 30-year yield inched down 0.5 basis point
to 1.895 percent, reversing its early rise to a six-week high of
1.905 percent ahead of the 600 billion yen auction of the same
maturities on Thursday.
But the 20-year yield added 0.5 basis point
to 1.755 percent after hitting a one-week high of 1.760 percent.