* Investors timid ahead of BOJ announcement
* Sony still in focus on new tablet news
* Olympus up, takes step to remove TSE warning
By Sophie Knight
TOKYO, Jan 22 The Nikkei share average crept
higher before the end of a Bank of Japan policy meeting on
Tuesday which is expected to set a 2 percent inflation target
and introduce more aggressive easing steps to boost growth.
The central bank is widely expected to double its current
inflation target, bump up its asset purchases budget and discuss
scrapping the interest it pays on banks' reserves, according to
The Nikkei edged up 0.4 percent to 10,795.12 by mid-morning,
with investors unwilling to play their hands before the BOJ
"Everyone expects the 2 percent inflation target but that
won't suffice," said Hisao Matsuura, an equity strategist at
"I think the market will drop no matter what they say, but
expectations are very mixed. It really depends what (the BOJ)
decides to do," Matsuura added.
Investors have been girding for the BOJ's decision since
then-incoming Prime Minister Shinzo Abe began calling for
aggressive easing in mid-November, helping to weaken the yen,
which boosted exporters and sparked a 26 percent rally in the
Some think the market has become overbought as a result,
with the BOJ meeting a ripe opportunity for a correction. The
Nikkei's up-down ratio, or the 25-day moving average of gainers
divided by the 25-day average of losers, stood at 146.85, well
above the 120-mark that signals an overheated market.
"I think the yen's weakening is pretty much over which means
the Nikkei's run is also over," said Fumiyuki Nakanishi, general
manager of investment and research at SMBC Friend Securities.
The yen was still off its 2-1/2 year low against the dollar
hit on Monday morning, trading at 89.71 on Tuesday.
However, Nakanishi said the market would remain firm, albeit
with a different focus.
"Exporters are oversold and attention is now going to switch
to domestic companies as the supplementary budget is discussed
in the Diet, which opens again on Jan. 28," he added.
On Monday morning Sony Corp remained in focus,
gaining as much as 3.3 percent on the back of a report in the
Nikkei business daily that it would launch a new version of its
Xperia tablet in Japan this spring after halting sales last year
due to faults.
Sony topped the main board as the most-traded stock by
turnover for a third day after news on Friday that its U.S.
subsidiary would sell its New York headquarters' building, with
$685 million of the sale to be recorded as operating income.
Olympus Corp shot up 6.1 percent after UBS
Securities started its coverage with a 'buy' rating and a target
price of 3,000 yen, against Monday's close of 1,862 yen. The
company on Monday submitted to the Tokyo Stock Exchange a
written affirmation on the internal control system as stipulated
in the securities listing regulations, which, if approved, will
see the camera maker's "securities on alert" status lifted.
The broader Topix gained 0.1 percent to 906.50 by