August 7, 2011 / 11:25 PM / 9 years ago

REFILE-Nikkei set to open lower on US downgrade

 (Refiles with stocks to watch)	
 TOKYO, Aug 8 (Reuters) - The Nikkei is set to edge lower on
Monday as investors remain concerned about a fall in U.S.
futures prices, which were hit by rating agency Standard &
Poor's downgrade on the country's AAA credit last week.	
 S&P 500 futures SPc1 fell 32.8 points and were below fair 	
value, a formula that evaluates pricing by taking into account 	
interest rates, dividends and time to expiration on the 	
contract. Dow Jones industrial average futures DJc1 slumped 	
287 points and Nasdaq 100 futures NDc1 lost 57 points.
 	
 S&P on Friday cut the long-term U.S. credit rating by one
notch to AA-plus on concerns about the government's budget
deficit and rising debt burden, a decision that put Washington's
dysfunctional politics under the spotlight.	
 But analysts said that after the Nikkei fell 5.4 percent
last week and with the dollar holding above 78 yen before
Monday's market opening, drops may be limited for the Japanese
market. Investors are also awaiting the outcome after the Group
of Seven leading economies agreed to hold an emergency phone
meeting of finance ministers and central bank governors.	
  "Investors are agitated by the downgrade. But since the
stock market tends to price in past events and look forward,
investors are eyeing the G7 conference outcome, therefore they
may stay on the sidelines for the time being," said Hiroichi
Nishi, general manager at SMBC Nikko Securities.	
 Foreign securities firms placed net sell orders of 17.6
million shares before the market opens on Monday.	
 Other analysts also say that the Tokyo market may downplay
the impact of the S&P move, with some even predicting a
corrective rise.	
 "A downgrade on the U.S.' credit rating was somewhat
expected, so the market even bounce later in the day as it fell
sharply last week," said Yumi Nishimura, a senior market analyst
at Daiwa Securities.	
 Nikkei futures in Chicago ended at 9,325, up 45 points 	
from their Osaka JNIc1 close of 9,280.	
 The benchmark Nikkei average fell 3.7 percent to 	
9,305.04 on Friday, while the broader Topix dropped 3.3 percent
to 809.32.	
 Analysts said that the Nikkei is expected to trade between
9,000-9,350 on Monday.	
	
----------------------MARKET SNAPSHOT @ 2313 GMT ------------	
                 INSTRUMENT   LAST       PCT CHG   NET CHG	
S&P 500                   1199.38     -0.06%    -0.690	
USD/JPY                   78.24        0.17%     0.130	
10-YR US TSY YLD     2.5629          --     0.000	
SPOT GOLD                 1684.99      1.37%    22.740	
US CRUDE            CLc1       84.34       -2.92%    -2.540	
DOW JONES                 11444.61     0.54%     60.93	
-------------------------------------------------------------   
                                                     	
 	
> Futures open down 2 pct after S&P downgrade            
> Euro jumps on U.S. dollar after ECB call             
> US 10-yr govt bond futures up; 30-yr falls            
> U.S. gold futures strike record after S&P downgrade  
> Oil falls $3 after U.S. credit rating downgrade       	
 STOCKS TO WATCH	
 --Olympus Corp 	
 Olympus said Friday it posted a 2.15 billion yen group net
loss in the April-June quarter against a profit of 1.50 billion
yen a year earlier on a sales fall attributable to the March 11
earthquake-tsunami disaster.	
 --Softbank 	
 Softbank Mobile Corp stayed on top of the rankings of
cellphone carriers' net increases in service subscriptions in
July for the 16th straight month due to brisk sales of Apple
Inc.'s iPhone 4, Kyodo reported, citing data released by
carriers Friday.	
 -- Nissan Motor Co 	
 Nissan said on Sunday it aimed to boost its sales in Japan
in a move that would also help reduce exports by as much as a
third and reduce the impact of the yen's crippling strength.
 	
 --Mitsubishi Corp 	
 Rio Tinto  and Mitsubishi Corp have made an
offer to buyout Coal & Allied, valuing the Australian coal miner
at A$10.6 billion ($11.1 billion).  	
 	
 	
	
	
 (Reporting by Ayai Tomisawa; editing by Abi Sekimitsu)	
 
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