March 20, 2019 / 3:04 AM / 4 months ago

REFILE-Nikkei steadies before Fed; Sony, Nintendo slide as Google targets gaming business

(Corrects to say Japanese markets will be closed on Thursday in 5th paragraph)

* Japanese markets closed on Thursday for holiday

* Sony, Nintendo both fall 4 pct

By Ayai Tomisawa

TOKYO, March 20 (Reuters) - Japan’s Nikkei edged up in midmorning trade on Wednesday after a choppy start as investors awaited the outcome of a Federal Reserve policy review, while Sony and Nintendo tumbled on news that Google is starting a gaming business.

The Nikkei share average was up 0.1 pct at 21,583.63 after opening lower, but has stayed well above its 25-day moving average of 21,417.29.

Traders said investors remained cautious before the Fed’s policy decision, with many expecting the central bank to reaffirm its dovish stance.

“The market’s consensus is that the Fed will take a patient stance on rates, but you don’t know how the market will react to the outcome while there is a holiday here,” said Hiroyuki Ueno, a senior strategist at Sumitomo Mitsui Trust Asset Management. “The market may be relieved but it’s possible that the market quickly prices in the outcome and profit-taking dents stocks.”

Japanese markets will be closed for a public holiday on Thursday.

The Fed, which is wrapping up its two-day policy review later in the day, is expected to lower its policymakers’ rate projections from December, when their median expectations were for two rate hikes this year.

Sony Corp and Nintendo Co both stumbled more than 4 percent after Alphabet Inc’s Google announced on Tuesday it would launch this year a browser-based video game streaming service dubbed Stadia that attempts to capitalize on the company’s cloud technology and global network of data centers.

“Google is such a big company with lots of resources. If it intends to make a full-scale entry into the gaming industry, it could give a big negative impact to game console makers in the mid-to-long term,” said Makoto Kikuchi, chief executive of Myojo Asset Management.

Chip-related stocks gained, after the Philadelphia SE Semiconductor index rose 1.3 percent to hit a six-month high. Sumco Corp and Shin-Etsu Chemical both added 0.6 percent and Tokyo Electron rose 0.8 percent.

The broader Topix added 0.1 percent to 1,612.18. (Editing by Shri Navaratnam)

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