TOKYO, Feb 26 (Reuters) - Japan's Nikkei average is likely to
fall on Thursday, following a rally the previous day and after
worries about stricter oversight for Wall Street hurt U.S.
stocks, but a weaker yen may support exporter shares.

Advantest Corp will likely be in focus after the world's
biggest supplier of machines that test semiconductors said it
would cut more than a quarter of its workforce and warned it
faces a record $804 million annual loss.

"Investors will likely take profits in stocks after
yesterday's gains, leading the market to move sideways or a bit
lower. But the softer yen may make it easier to pick up
exporters," said Yoku Ihara, manager at Retela Crea Securities.

"Uncertainty still hasn't been wiped out in the United States
as the housing market is still weak, though measures to deal with
the banking sector seem to be progressing little by little."

Nikkei futures traded in Chicago closed at 7,415 on
Wednesday, down 65 points from the Osaka close, pointing to a
lower open.

Market participants expect the benchmark Nikkei to move
between 7,300 and 7,500 on Thursday.

The Nikkei ended the previous day up 2.7 percent at 7,461.22,
snapping a three-day losing streak that saw it fall as low as
7,155.16 on Tuesday -- within sight of a 26-year low just under
7,000.

Shares of homebuilders and big manufacturers fell in U.S.
trade after data showing sales of previously owned U.S. homes
plunged much more than expected in January.

STOCKS TO WATCH

-- Daiichi Sankyo

A plant owned by Indian generic drugmaker Ranbaxy
Laboratories falsified data and test results submitted in
approved and pending drug applications, U.S. regulators said on
Wednesday. Daiichi Sankyo holds a controlling stake in Ranbaxy.

-- Nissan Motor Co

Nissan plans to schedule less downtime at three of its
Japanese assembly plants in March after earlier production cuts
helped to reduce inventory, the Nikkei business daily said.

-- Yamaha Motor Co Ltd

Yamaha Motor will cut Japanese motorcycle output by 24
percent in 2009 to the lowest level in about four decades as
demand drops and inventories build, the Nikkei said.

-- Sharp Corp

Sharp plans to issue up to 200 billion yen ($2.05 billion) in
straight bonds to keep up cash reserves as it invests heavily in
projects such as an LCD panel plant, the Nikkei reported.

-- Hitachi Ltd

Hitachi, facing an estimated group net loss of 700 billion
yen ($7.19 billion) for the year ending in March, plans to cut
costs to improve profitability, Senior Vice President Toyoaki
Nakamura said in an interview with financial daily Nikkei.

-- Toyota Motor Corp

Toyota Motor Corp said on Wednesday its global output plunged
42.6 percent in January from a year earlier to 413,285 vehicles,
as carmakers slash production to work off their inventories amid
the global car market slump.

That marked the biggest percentage drop at Toyota, the
world's biggest automaker, on records going back to 1987.

Honda Motor Co and Nissan also reported steep falls.

-- Seiko Epson

Seiko Epson said it plans to compile a new three-year
business strategy by the end of March, and costs associated with
the restructuring plan could force it to miss its annual earnings
outlook.

-- Lawson Inc

Lawson, Japan's second-largest convenience store chain, said
on Wednesday it has agreed to acquire smaller rival am/pm Japan
Co for $149 million, boosting its presence in Tokyo area.
(Reporting by Aiko Hayashi; Editing by Chris Gallagher)