Japan stocks seen rising broadly led by high-techs

TOKYO, Oct 29 (Reuters) - Japanese stocks are expected to gain on Monday, powered by expectations of a cut in U.S. interest rates and a rally on Wall Street, with high-tech shares likely to lead the way after an upbeat outlook by Microsoft last week. Market attention may also centre on Nissan Motor Co (7201.T: Quote, Profile, Research, Stock Buzz) after it posted a surprise gain of 12 percent in quarterly operating profit on Friday as a pickup in its global car sales outweighed rising commodity prices, and kept its full-year forecasts unchanged. [ID:nT352047]

"We're likely to see fairly broad gains today in Tokyo, spurred by shares like Nissan and high-techs, which may set off buying across the board," said Hiroichi Nishi, general manager of equity market at Nikko Cordial Securities. "There will also be upward energy from expectations of a Fed rate cut, which seems virtually assured."

Other market participants sounded a note of caution, saying gains could be capped if the yen rises against the dollar. The dollar was around 114.12 yen <JPY=> in early Asian trade. U.S. stocks rallied on Friday, buoyed by an upbeat outlook from Microsoft (MSFT.O: Quote, Profile, Research, Stock Buzz) that boosted all three indexes, while the financial sector gained on a profit forecast from lender Countrywide Financial CFC.N.

Microsoft lifted its full-year forecasts late on Thursday and reported quarterly profit that beat analysts' expectations. Country wide, the largest U.S. mortgage lender, reported a quarterly loss on Friday but forecast a profit in the fourth quarter as it slashes jobs.

Tokyo's benchmark Nikkei average .N225 is expected to move between 16,400 to 16,750 on Monday, supported by expectations of the Fed rate cut, with buying of futures also likely to give it upward energy.

It finished Tokyo trade at 16,505.63 on Friday, a gain of 221.46 points.

Nikkei futures traded in Chicago 2NKc1 ended at 16,665, up from 16,490 in Osaka JNIc1, in a sign of how the market may move in Tokyo.

The Dow Jones industrial average .DJI rose 0.99 percent to 13,806.70 on Friday, a gain of 134.78 points. The Standard & Poor's 500 Index .SPX was up 20.88 points, or 1.38 percent, at 1,535.28. The Nasdaq Composite Index .IXIC was up 53.33 points or 1.94 percent at 2,804.19.

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