Nikkei falls as Fed move hits US stocks, TDK down

TOKYO, Mar 29 (Reuters) The Nikkei fell 0.26 percent on Wednesday, as a sharp fall on Wall Street after the U.S. Federal Reserve hinted at more interest rate increases helped push down TDK Corp.

and other recent gainers.

Shares in Yahoo Japan Corp. jumped after an industry source said the firm would invest in a venture to take an indirect stake in an online bank.

Although U.S. stocks fell, the impact on Tokyo was relatively subdued, said Hiroyuki Nakai, chief strategist at Tokai Tokyo Securities.

''U.S. stocks reacted to comments there would likely be another rate rise, but to a certain degree that was already factored in by the Tokyo market,'' he said.

''All things considered, the market is fairly strong right now.'' The Fed raised interest rates for the 15th time by a quarter percentage point to 4.75 percent. The central bank reiterated that more increases may be needed.

The Nikkei was down 42.95 points at 16,647.29 as of 0054 GMT.

The TOPIX index was down 0.06 percent at 1,691.61.

Shares in TDK fell 0.7 percent to 8,880 yen, trimming gains from the previous two sessions.

Internet portal operator Yahoo Japan rose 5.6 percent to 69,800 yen after an industry source said the company would invest in a venture to take an indirect stake in Japan Net Bank.

REUTERS PDS RN0721