Nikkei seen edging up, expectations high for BOJ action

Sun Jan 20, 2013 11:37pm GMT

TOKYO, Jan 21 (Reuters) - Japan's Nikkei share average was
seen rising slightly on Monday as the Bank of Japan begins a
two-day policy meeting, building its 31-month closing high
logged in the previous session on expectations that the central
bank will set a 2 percent inflation target.
    Market players said the Nikkei was likely to trade between
10,850 to 11,000 after Nikkei futures in Chicago closed
at 10,965 on Friday, up 0.4 percent from the close in Osaka
 of 10,920.
    "After the BOJ meeting tomorrow the market is likely to fall
as all factors will be exhausted, but because domestic earnings
reports start next week I don't think it will really fall that
much," said Masayuki Otani, chief market analyst at Securities
Japan.
    U.S. earnings have been largely positive, helping to lift
the Dow and S&P 500 to five-year highs on Friday, with Morgan
Stanley the latest bank to trump expectations, although
Intel Corp's disappointing results left it down 6.3
percent. 
    Overall, S&P 500 fourth-quarter earnings are forecast to
have risen 2.5 percent, according to Thomson Reuters data. That
estimate is above the 1.9 percent forecast from a week ago but
well below the 9.9 percent fourth-quarter earnings forecast from
Oct. 1, the data showed. 
    The Nikkei has notched up 10 straight weekly gains, its
longest winning streak since 1987, after heightened expectations
of easing from the Bank of Japan pushed the yen to a 31-month
low against the dollar. 
    The yen sank to a fresh 2-1/2 year low on Monday morning of
90.25 to the dollar.
    A deputy economics minister said on Friday that the central
bank and the government have agreed to set a 2 percent inflation
as a policy target in a joint statement, although no clear
timeframe has been fixed to meet the goal. 
    The Nikkei has risen around 26 percent over the past two
months since then-incoming prime minister Shinzo Abe began
calling for aggressive easing. 
    
> Dow, S&P 500 end at 5-yr highs on early earnings beats    
> Yen slumps to 31-month low on expected BoJ action       
> Bond prices climb as buyers emerge after sell-off        
> Gold slightly lower after weak U.S. consumer data       
> Brent crude up on debt limit proposal, supply worries    
    STOCKS TO WATCH
    -NISSAN MOTOR CO LTD 
    Nissan may begin to manufacture its cars in plants owned by
Renault in France, according to the Nikkei business daily, which
quoted the French Industry Minister Arnaud Montebourg as saying
that Nissan had agreed to Renault's request to support French
factories. 
    -NAMCO BANDAI HOLDINGS INC 
    Namco Bandai, a video games maker, will likely post an
operating profit of 40 billion yen ($445 million) for the nine
months between April and December due to strong sales of
character merchandise, the Nikkei business daily said. 
    - UNITED ARROWS 
    United Arrows, a boutique clothing store operator, is likely
to see record operating profits for the three quarters between
April and December of around 12 billion yen ($133 million),
which would mark a 10 percent increase on the year, due to
strong sales of winter clothing.