Japan stocks may climb at open, but gains limited

Subscribe to Oneindia News

TOKYO, Nov 28 (Reuters) Financial stocks such as Mitsubishi UFJ Financial Group may give Tokyo shares a lift on Wednesday after their peers gained on Wall Street on Abu Dhabi's purchase of a stake in Citigroup, but gains may be limited as U.S. stocks remain volatile.

Yutaka Miura, deputy manager of the equity information department at Shinko Securities, said the Japanese market had priced in Citi's news on Tuesday but the rise in U.S. financial shares would inevitably boost similar shares in Japan.

''After opening higher, the market will likely be a mix of buying and selling,'' Miura said, adding that there would likely be no key sectors guiding Wednesday's trade.

''Short-covering will be the main activity in the market as stocks have been oversold. The market can't pursue the upside without a softer yen and a rally in U.S. stocks.'' One stock in focus may be Astellas Pharma Inc The Japanese drugmaker said on Tuesday it would buy U.S. biotech company Agensys Inc for 7 million to boost its antibody research and development for cancer treatments.

Nikkei futures traded in Chicago ended the previous session at 15,270, up 30 points from the Osaka close, indicating a slightly higher opening.

The dollar held above a 2-1/2-year low against the yen touched on Monday, trading around 108.80 early on Wednesday in Tokyo.

Market participants expect the Nikkei average to trade between 15,100 and 15,400 after finishing Tuesday up 0.6 percent at 15,222.85.

U.S. stocks rose on Tuesday after Abu Dhabi's .5 billion purchase of a stake in Citigroup spurred a rebound in financial stocks and a drop in oil prices boosted shares of big manufacturers.

The Dow Jones industrial average was up 1.69 percent at 12,958.44.

STOCKS TO WATCH -- McDonald's Japan McDonald's Japan said on Tuesday it may have sold salads and other items past their expiry dates at as many as four of its Tokyo outlets after employees switched product labels.

-- Toshiba Corp, NEC Electronics Corp Toshiba and NEC Electronics said on Tuesday they would jointly develop 32-nanometre chips to better keep up with rivals.

The companies will continue talks about jointly producing the chips, and aim to reach a decision in 2008, they said.

-- INPEX Holdings Inc The company said on Tuesday it had bought a 10 percent stake in the Joslyn oil sands upstream development project in Alberta, Canada, from French oil and gas group Total.

Reuters AK VP0555

Please Wait while comments are loading...