Nikkei edges up on buying in banks, real estates

Tue Nov 27, 2012 1:56am GMT

* Investors shifting to buy domestic-demand stocks
    * Investors take profits in exporters
    * Foreigners still buyers - analyst

    By Ayai Tomisawa
    TOKYO, Nov 27 (Reuters) - Japan's Nikkei share average edged
up on Tuesday, as investors bought domestic-demand shares while
they took profits on exporters which have sharply gained on
expectations that a weak yen will boost their earnings.
    Amid investor caution over the fast pace of gains that has
seen the benchmark climb more than 8 percent in the past two
weeks, profit-taking is natural, analysts said.
    The Nikkei was up 0.4 percent to 9,425.40, after
ending at its highest closing level since April 27 on Monday.
The index has added 8.4 percent in the past two weeks.
    Exporters, which have advanced on hopes that a weak yen will
lift their earnings, were down, with Toyota Motor Corp,
Honda Motor Co and Nikon Corp all dropping
between 0.7-0.9 percent. The stocks have risen 15-19 percent
over the past two weeks.
    "Investors are still staying as buyers, but they are
shifting to domestic-demand stocks as they are cautious of a
steep rise in exporters," said Hikaru Sato, a senior technical
analyst at Daiwa Securities. "Foreign buying will likely
continue for the time being."
    Local demand-related stocks such as banks and real estate
shares attracted buying, with Mitsubishi UFJ Financial Group
 adding 1.1 percent, Sumitomo Mitsui Financial Group
 gaining 1.4 percent and Mitsui Fudosan 
advancing 1.5 percent.   
    Traders said that investors, who were underweight Japanese
stocks, continued to pour new money in to the Japanese market on
the back of the weakening yen. On Tuesday, foreigners posted net
buy orders for Japanese stocks for a 12th day.
    The yen has come under pressure on expectations the Bank of 
Japan will be pushed towards more drastic easing, after the 
country's opposition party, tipped to win next month's election,
campaigned for radical monetary stimulus to beat deflation.
    But on Tuesday morning, the dollar last traded at 81.99 yen
, slightly weakening against the yen. Traders said some
investors unwound long positions in the U.S. dollar built up in
recent weeks.
    Meanwhile, the euro hit a one-month peak against the U.S.
dollar after officials said euro zone and International Monetary
Fund officials had reached a deal on reducing Greece's debt.
 
   The euro jumped to $1.2992, according to Reuters data,
0.1 percent higher on the day and its best showing since late
October. 
    "It is positive that there is a progress in the ongoing
euro-zone issues, but the impact on the stock market should be
limited," said Hiroichi Nishi, general manager at SMBC Nikko
Securities, adding that investors will continue holding their
breath while they await for signs for movement in talks over the
U.S. budget wrangle. 
    U.S. lawmakers are expected to resume negotiations this week
on a compromise that would avoid roughly $600 billion in
automatic tax increases and spending cuts that are due to hit in
January. 
    Market players said the Nikkei was likely to trade between
9,350 to 9,450 on Tuesday.
    The broader Topix added 0.3 percent to 781.66.
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