Japan stocks seen slipping, but buoyed by high-tech

TOKYO, Oct 17 (Reuters) - Japanese stocks are likely to edge down on Wednesday and possibly slip below 17,000 after Wall Street fell on disappointing bank results, but buying on dips will keep any such foray brief.

Sanyo Electric (6764.T) will be in focus after the Nikkei business daily reported that it has ended talks with Advantage Partners LLP on the sale of its semiconductor unit because Advantage is facing difficulty raising funds.

A source close to the situation later also said Sanyo would keep the unit because the talks had failed.

But the market is expected to be boosted by strong high tech stocks after better-than-expected results were posted by U.S. technology bellwethers Yahoo (YHOO.O) and chip maker Intel (INTC.O) after the bell, with Nintendo Co Ltd (7974.OS) likely to shine.

"What we are likely to see in Tokyo is a reflection of Wall Street, where there was a real mix of good and bad news. Here too banks are likely to be weak and high tech strong," said Seiichi Miura, a strategist with Mitsubishi UFJ Securities.

"Nintendo and other game makers, like Konami, are likely to be particularly strong, and they will help support the market along with high tech stocks."

Disappointing results from large U.S. banks such as Wells Fargo & Co (WFC.N), along with record-high oil prices, dragged Wall Street lower on growing concern for corporate profits.

Oil rose about $88 a barrel on supply worries as tensions rose between Turkey and Kurdish separatists in northern Iraq, raising fears that high energy prices could dampen U.S. consumer and business spending.

Miura said that oil and trading firms are likely to gain as a result of the higher oil prices, providing the market with additional support, but other market players have warned that the long-term impact of higher oil is most likely negative.

The Nikkei was expected to trade in a range from 16,950 to 17,200. It finished Tuesday trade down 1.3 percent at 17,137.92.

Nikkei futures traded in Chicago 2nkC1 finished at 16,960.00, down by 30.00 compared to Tuesday's Osaka futures close, in a sign that Tokyo shares may dip for the second straight day. The Dow Jones industrial average DJI> fell 71.86 points, or 0.51 percent, to end at 13,912.94. The Standard & Poor's 500 Index .SPX slid 10.18 points, or 0.66 percent, to 1,538.54.

STOCKS TO WATCH

-- Sanyo Electric (6764.T)

Sanyo has ended talks with Advantage Partners LLP on the sale of its semiconductor unit because Advantage is facing difficulty raising money amid the subprime mortgage loan crisis, the Nikkei business daily reported on Wednesday.

-- Tomy Co Ltd (7867.T)

Toymaker Tomy Co on Tuesday revised up its first-half earnings forecasts, citing strong sales at a unit that handles Nintendo Co (7974.OS) products as well as higher sales of pre-school items in the European market.