* JGB futures extend losses to hit 1-mth low after auction

* Nikkei drops 3.9 pct, limiting decline in JGBs

* Yield curve steepens, rise in two-year yield small

* BOJ starts special operation to help corporate financing

By Rika Otsuka

TOKYO, Jan 8 (Reuters) - Japanese government bond futures struck a one-month low on Thursday as a weak 10-year debt auction underscored lukewarm investor demand, prompting some players to book profits after a steep rally at the year-end.

The Ministry of Finance's 1.9 trillion yen ($20.49 billion) 10-year JGB auction attracted bids 2.33 times the bids accepted, below 2.90 at previous auction for the maturity. [ID:nT51915]

That stoked concerns over investor demand, sparking bond selling, although analysts and traders said the auction results were at the lower end of market expectations and nothing surprising.

"It's rather that some people are using a soft auction as an excuse to take profits after a big bond rally at the year-end," said a senior bond trader at a Japanese bank.