* Ex-dividend day for Canon, Honda, others, weighs on index
* Quashed hopes for joint euro bond weakens buying sentiment
before EU summit
* Small-cap speculative stocks see huge gains
By Sophie Knight
TOKYO, June 27 Japan's Nikkei share average was
flat by Wednesday's midday break as losses among a slew of
blue-chip companies going ex-dividend were balanced by massive
gains for a few speculative stocks as uncertainty reigned ahead
of an EU summit on Thursday.
Market players were reluctant to put their faith in blue
chips ahead of an EU summit to discuss strategies to tackle a
worsening debt crisis across the common currency block, with few
expecting significant decisions to be made.
Canon Inc, Honda Motor Co Ltd, Bridgestone
Corp and Asahi Glass lost between 1.3 and 4.6
percent as they went ex-dividend, meaning buyers of the stocks
from Wednesday onwards will not be entitled to receive
The Nikkei was flat at 8,664.20 after dipping in and out of
negative territory, while the broader Topix was 0.1
percent higher at 739.23.
"The market isn't moving as a whole and blue-chips are
sagging because investors are waiting for the EU summit, but
some speculative stocks are seeing massive gains," said Kenichi
Hirano, operating officer at Tachibana Securities. "A day like
this could be quite fun for day traders."
Volatile small-caps Mutoh Holdings Co Ltd, Look Inc
and Kogi Corp soared between 18 and 21.1
percent as short-term investors piled in to short the stock.
"Investors are hoping that euro zone leaders will discuss a
banking and fiscal union later this week, and will be
disappointed if they don't come out with something concrete,"
said Fumiyuki Nakanishi, general manager of investment and
research at SMBC Friend Securities.
Yet any remaining hope that the creation of joint euro bonds
might be on the table was extinguished on Tuesday after German
Chancellor Angela Merkel said she would never allow Europe to
share joint debt liability.
Japan Tobacco Inc, a reliable defensive favoured by
investors for its solid cash flow, rose 3 percent, while the
real estate sector snapped a three-day losing run
with a gain of 2.1 percent after Nomura Securities said the
sector should benefit from increased demand ahead of a
consumption tax increase in 2014.
Tokyu Livable Inc jumped 6.3 percent, while
heavyweights Sekisui House Ltd and Daito Trust
Construction Co Ltd added 1.7 and 2.1 percent,
Astellas Pharma Inc firmed 1.2 percent after the
company said it had submitted an application to market a drug
for prostate cancer together with Medivation Inc.
Trading on the main board was thin, at just 35 percent of
its 90-day average.
The Nikkei closed 0.8 percent down on Tuesday at 8,663.99, a
one-week low, but held above resistance at the 25-day moving
average at about 8,597.
"There's pretty strong support around its 25-day moving
average around 8,600 and I think the market is still in
correction mode after a couple of days of losses," said
Yoshihiro Ito, chief strategist at Okasan Online Securities.
The benchmark index is now down 14 percent this quarter,
which ends on Friday, having reversed most of its first-quarter
rally of 19.3 percent on concern over the euro zone crisis and
signs of slowing growth in the United States and China.