Nikkei set to fall after more U.S. firms warn on sales
TOKYO, July 11 (Reuters) - Japan's Nikkei share average is expected to decline for a fifth straight session, with more revenue warnings from U.S. companies, including engine maker Cummins Inc, seen weighing on sentiment already hit by weak global economic data.
Market players said the Nikkei was likely to trade between 8,750 to 8,900 on Wednesday after Nikkei futures in Chicago <0#NIY:> closed at 8,835, down 0.3 percent from the Osaka close .
"It's now important to watch to see if the Nikkei breaks its 25-day moving average at around 8,753 either today or tomorrow," said Toshiyuki Kanayama, senior market analyst at Monex Inc.
"That could lead us to back to the same pattern as in early June," he added, referring to the six-month low the benchmark index struck on June 4 after falling 19 percent from its March 27 high.
The Nikkei ended 0.4 percent lower on Tuesday at 8,857.73, hurt by a smaller year-on-year increase in Chinese imports in June. The benchmark index now rests on a key trend-line that connects the intraday lows of June 4 and June 26-27 that some see as a sign that its one-month rally has finished.
The Bank of Japan will hold a two-day policy meeting beginning later on Wednesday. Although some market players are hopeful that the central bank may introduce further easing steps, an increasing number expect it to stand pat after it released an unexpectedly positive economic review.
Kanayama said the market will continue to focus on defensive stocks amid uncertainty about the euro zone crisis and a slowdown in the United States, China and emerging nations. > More profit warnings hit Wall Street > Euro slides to 2-year low vs dollar, $1.20 in focus > Prices inch up as safety bid overcomes supply > Gold down 1.3 pct on weak commods, market jitters > Oil falls as Norway strike ends, China's imports slip
STOCKS TO WATCH
NTT DoCoMo Inc said it has joined hands with six foreign telecommunications service providers to make their machine-to-machine data communications compatible, enabling users to utilise the service in more countries, the Nikkei business daily reported. ($1 = 79.4700 Japanese yen) (Reporting by Sophie Knight; Editing by Edwina Gibbs)
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