July 9, 2014 / 1:50 AM / 3 years ago

Nikkei drops to fresh 1-week low on weak U.S. shares; ANA shines

* ANA rises on increased traffic, CLSA's rating hike
    * Analysts see signs Japanese shares still overheated

    By Ayai Tomisawa
    TOKYO, July 9 (Reuters) - Japan's Nikkei share average fell
to a fresh one-week low on Wednesday morning as U.S. stocks beat
a retreat before the start of the earnings season, and the
stronger yen hurt exporters.
    Bucking the weakness, ANA Holdings rose 1.3 percent
after CLSA hiked its rating to 'buy' from 'outperform' citing
its strong inbound and outbound traffic.
    The airlines said on Tuesday that its international traffic
for the first time outpaced its rival Japan Airlines Co 
in May.
    The Nikkei dropped 0.5 percent to 15,237.08 in
mid-morning trade after going as low as 15,185.32, its lowest
level since July 1.
    Analysts said there were signs that the Japanese shares are
overheated. Tuesday's up-down toraku ratio was 128, with a level
above 120 signalling an overheated market. 
     "Today's fall is a little correction and we may see more
declines in the coming days," said Takuya Takahashi, an analyst
at Daiwa Securities.
    But he added that the Nikkei should be supported above the
    Exporters lost ground after the dollar slipped to a near
one-week low of 101.48 yen.
    Toyota Motor Corp shed 1.1 percent, Nissan Motor Co
 declined 1.1 percent and Panasonic Corp fell
1.2 percent.
    The broader Topix slipped 0.5 percent to 1,269.55,
and the JPX-Nikkei Index 400 dropped 0.4 percent to

 (Editing by Eric Meijer)

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