Japan stocks seen falling after US slide

TOKYO, May 31 (Reuters) Japanese stocks are expected to fall on Wednesday, led by high-tech firms and other exporters, pulled down by a slide in US stocks and continued concern about selling by foreign investors.

Sentiment is likely to be battered after Chicago-traded Nikkei futures posted a sharp decline. Nikkei future contracts expiring in June closed at 15,580 in Chicago, a fall of 260 points from the Osaka finish.

''The market is likely to try and test the low set in Chicago,'' said Shinji Igarashi, equity manager of sales at Chuo Securities.

Concern that foreign investors -- the main driver of last year's bull run -- were pulling away from Japanese equities was likely to weigh on tech stocks, he said.

''Shares of companies that have high percentage of ownership by foreigners, such as techs, are likely to come under selling pressure.'' Traders expect the Nikkei average to move between 15,500 and 15,700 on Wednesday. It fell 0.35 percent to 15,859.45 on Tuesday.

U.S. stocks declined due to concerns about a potential slowdown in consumer spending.

STOCKS TO WATCH -- Kao Corp.

The head of Japan's biggest maker of household products told Reuters on Tuesday that the company aimed to return to growth in recurring profit within two to three years, despite heavy amortisation costs from its purchase of Kanebo Cosmetics Inc.

-- Hitachi Ltd., Matsushita Electric Industrial Co., Toshiba Corp.

The three firms' liquid crystal display joint venture plans to spend 80 billion yen (3 million) to double output capacity, the Nihon Keizai business daily reported on Wednesday.

Reuters VJ VP0530