Nikkei set to fall as economic gloom thickens

TOKYO, Nov 12 (Reuters) - Japan's Nikkei average is set to
extend losses on Wednesday as concern about the global economy
grows in the face of more bad U.S. company news, with a stronger
yen likely to hit Sony Corp (6758.T) and other exporters.

One stock to watch will be JFE Holdings Inc (5411.T) after
its core steel company, JFE Steel Corp, the world's third-biggest
steelmaker, said on Tuesday it may cancel or suspend two projects
worth a combined $10-12 billion to build integrated steel mills
in Brazil and Vietnam if demand remains weak. [ID:NT139473]

Fears of an economic slowdown grew on news of slowing demand
at aluminium maker Alcoa (AA.N) and a dismal outlook from Tyco
International Ltd (TYC.N), with the market also focusing on
General Motors (GM.N) as its shares slid for a 5th day and
investors worried about the chances of the auto sector gaining a
government cash infusion.

"There's a tug-of-war emerging between expectations for
stimulus packages from governments around the world, and the
harsh reality of the actual economy," said Hiroichi Nishi,
general manager in the equity division of Nikko Cordial
Securities.

Trade is likely to be thin as the market awaits the G20
financial crisis summit on Nov. 14 and 15, with volatile moves
expected, although buying from individual investors and pension
funds is likely at the lows.

The benchmark Nikkei .N225 is expected to move between
8,400 and 8,700. It closed at 8,809.30 on Tuesday.

Nikkei futures traded in Chicago 2NKc1 finished at 8,555
compared with the Osaka close of 8,780 JNIc1.
----------------------MARKET SNAPSHOT @ 2243 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG
S&P 500 .SPX 898.95 -2.2% -20.260
USD/JPY JPY= 97.61 -0.06% -0.060
10-YR US TSY YLD US10YT=RR 3.7604 -- 0.000
SPOT GOLD XAU= 730.35 -0.05% -0.400
US CRUDE CLc1 59 -5.46% -3.410
DOW JONES .DJI 8693.96 -1.99% -176.58
-------------------------------------------------------------
> Wall St slides as Tyco, Alcoa feed economic worries [.N]
> Dollar rises to 2-week highs on global growth worries [USD/]
> Bonds gain as stocks fade, 3-year notes return [US/]
> Gold falls on dollar rise, stock market woes [GOL/]
> Oil drops 5 pct to $59 as demand weighs [O/R]
STOCKS TO WATCH

-- JFE Holdings Inc (5411.T)

JFE Steel Corp, the company's core steel company and the
world's third-largest steelmaker, said on Tuesday that it may
cancel or suspend two projects worth a combined $10-12 billion to
build integrated steel mills in Brazil and Vietnam if demand
remains weak. [ID:nT139473]

-- Mitsubishi Rayon Co (3404.T)

Mitsubishi Rayon said on Tuesday it would acquire unlisted
British chemicals producer Lucite International for $1.6 billion
in cash, joining a growing list of Japanese companies that are
snapping up overseas bargains in the global financial crisis.
[ID:nT46372]

-- Sumitomo Metal Mining Co (5713.T)

Sumitomo Metal Mining has decided to push back construction
of a nickel ore processing plant in the Philippines by one year,
postponing plans that originally called for breaking ground early
next year, the Nikkei business daily said on Wednesday.
(Reporting by Elaine Lies; Editing by Hugh Lawson)