Nikkei seen edging higher, softer yen to boost stocks

TOKYO, Feb 23 (Reuters) - Japan's Nikkei share average
is expected to edge higher on Thursday, with the softer yen
underpinning market sentiment and boosting risk appetite as
investors hope for a robust recovery in corporate earnings.

Market participants said the Nikkei was likely to trade
between 9,550 to 9,650 on Thursday, boosted by buying of
exporters and bluechips that benefit from the softening yen,
which fell to a seven-month low overnight. The dollar
was last trading at 80.26.

Nikkei futures in Chicago <0#NIY:> closed at 9,570,
unchanged from the Osaka close.

"European sovereign debt concerns have receded and market
participants are returning to equities amid excessive liquidity.
The softer yen is also boosting many investors' hopes for a
v-style earnings recovery in the coming quarter," said Hiroichi
Nishi, equity general manager at SMBC Nikko Securities.

The Nikkei is up more than 8 percent so far this month on
the back of strong economic data out of the United States, the
European Central Bank's liquidity injection of nearly half a
trillion euros and further easing steps by the Bank of Japan.

"The Nikkei has gained more than 11 percent so far this year
and a lot of foreign investors are returning to the market and
market energy (trading volume) is growing, so I do think that
although U.S. stocks are taking a break at their recent highs,
the Nikkei has more room to rally," Nishi said.

On Wednesday, the benchmark Nikkei closed 1 percent
higher at 9,554.00, topping the key 9,500 level for the first
time since August. The broader Topix index advanced 1.1
percent to 825.40, also a fresh six-month closing high.

Wall Street closed lower on Wednesday as banks dragged down
indexes and both the Dow and the S&P 500 failed to
top recent highs.

> Banks sink on European economic worry
> Yen plummets to 7-month low vs dollar; sterling down
> Bonds jump on Greece, Middle East jitters
> Gold jumps to 3-month high on chart buying
> Brent oil rises to 9-month high on Iran tension

STOCKS TO WATCH

--MAZDA MOTOR

Mazda Motor Corp said after the close on Wednesday that it
would raise up to 162.8 billion yen ($2 billion) through a
public share offering, which would cause a 68.5 percent dilution
of its existing shares, according to a Reuters calculation.

--JFE HOLDINGS

Japanese steelmaker JFE Holdings' decision to increase its
stake in India's JSW Steel Ltd is expected to boost
the Japanese steelmaker's pretax profit by nearly 5 billion yen
next fiscal year, the Nikkei business daily said on Thursday.

--DOCOMO, KDDI CORP

NTT DoCoMo Inc and KDDI are likely to report
lower-than-expected average monthly income per cellular phone
subscriber for the year ending March due to weak smartphone
sales, the Nikkei business daily said.

--MITSUI & CO LTD

Trading house Mitsui & Co bought Brazil's Veloce Logistica
SA, which manages parts transportation and distribution centers,
for 4.7 billion yen to expand into the South American country's
auto parts distribution business, the Nikkei said.

(Reporting by Mari Saito)