* Nikkei eases 0.5 pct, Topix down 0.3 pct
* Softbank rises after announcing tender offer on Gungho
By Dominic Lau
TOKYO, March 26 Japan's Nikkei average slipped
on Tuesday after a senior euro zone official said the Cyprus
rescue could be a new template to deal with other banking
problems in the region.
Gains in index heavyweight Softbank Corp, after its
mobile unit said it will launch a tender offer to make game
developer Gungho Online Entertainment Inc a
consolidated subsidiary, helped limit the loss.
The Nikkei dropped 0.5 percent to 12,488.39, after
rebounding 1.7 percent on Monday on the back of Cyprus agreeing
a deal with international lenders to avert a collapse of its
"We have seen some pretty good flows. We do have a bit of
profit taking in some blue chips. I guess we are 50-50 (in buy
and sell orders)," a senior dealer at a foreign bank in Tokyo
However, he said some of the selling was coming from
Among the blue chip companies that succumbed to profit
taking included Toyota Motor Corp, Honda Motor Co
and construction equipment maker Komatsu Ltd,
down between 0.5 and 1.1 percent.
The Cyprus deal is forcing large uninsured depositors and
bondholders to bear heavy losses, and Dutch Finance Minister
Jeroen Dijsselbloem, who heads the Eurogroup of euro zone
finance ministers, said the Cyprus bailout represented a new
model for resolving banking crises in the currency bloc.
Mobile operator Softbank climbed 2.2 percent and was the
most traded stock on the main board by turnover after its
Softbank Mobile Corp said it would raise its stake in Gungho to
40 percent from 33.6 percent in a tender offer from April 1 to
26. Gungho sank 5.8 percent.
Nomura Securities reiterated its 'buy' rating on Softbank,
saying "for fiscal year 2013/14, when Softbank will move to
IFRS, Softbank's existing 33.63 percent stake in Gungho will be
valued at its March 29 closing price, and any valuation gains
will be posted to operating profits based on IFRS accounting
The broader Topix index eased 0.3 percent to
The benchmark Nikkei has rallied 44 percent since
mid-November, when Prime Minister Shinzo Abe unveiled proposals
during his election bid for expansionary fiscal and monetary
policies to revive the economy.
"At the end of May 2012, over 20 percent of Japanese stocks
qualified as Deep Value. That number has since dropped to just 5
percent, making Japan the second-most expensive region on this
basis behind the U.S.," Societe Generale wrote in a note.
"Japan is now going to have to demonstrate improving
fundamentals to warrant further upside."
Japanese equities carry a 12-month forward price-to-earnings
ratio of 14.1, a level not seen since August 2010 and compared
with U.S. S&P 500's 13.6, data from Thomson Reuters