Nikkei seen bouncing after falling 7 pc this week

Tokyo, June 9: The Nikkei average is seen gaining ground on bargain-hunting on Friday after falling more than 7 percent in a four-day losing streak.

Once June Nikkei futures and futures options contracts are settled, based on component share prices at Friday's opening, the market may regain some stability.

The settlement, known as the special quotation or SQ and expected soon after the opening, often boosts liquidity and encourages investors to adjust short-term positions.

''The indices have been beaten down to a level that looks pretty well low enough for now. The market is waiting for a catalyst to help it turn round and recover,'' said Koichi Seki, manager at Chuo Securities' sales marketing department.

''The SQ could be the catalyst if investors think it's time to get rid of a lot of remaining positions,'' he said.

The Nikkei will likely move between 14,600 and 14,900 on Friday, traders said. It fell 3.07 percent or 462.98 points to end at 14,633.03 on Thursday, the lowest close since last November.

Chicago-traded Nikkei futures gained ground, with contracts expiring in September closing at 14,740, a rise of 140 points from the Osaka finish.

Japanese machinery orders data is due at 2 p.m. (0500 GMT).

Some analysts said if the data confirms that Japan's economic recovery is making progress that could also support the market.

Core machinery orders, a highly volatile figure regarded as a leading gauge of capital spending, are forecast to have risen 3.3 percent in April, according to a poll of 24 economists.

STOCKS TO WATCH -- Nippon Telegraph and Telephone Corp.

The Communications Ministry is considering asking NTT group to dramatically reduce the charges it levies on other communications services providers for using its fiber-optic lines, business daily Nihon Keizai said.

-- Sony Corp The soccer World Cup tournament in Germany, which opens on Friday, generated slower-than-expected sales of flat-screen televisions in March and April, Japanese electronics and media group Sony told Reuters.

-- Nikko Cordial Corp.

Japan's securities watchdog called on Thursday for disciplinary action against the asset management unit of Nikko Cordial Corp. over improper procedures of investment trusts.

-- Nippon Steel Corp.

Japan's biggest steel maker, said in an interview with Reuters on Thursday it aims to boost its export price by more than 10 percent next quarter in the wake of a strong market recovery in Asia, a sign that its profit this year could beat its forecast.

-- Benesse Corp.

President Masayoshi Morimoto said on Thursday the company chairman's offer this month of 4 percent of shares outstanding was aimed at more than doubling the number of individual shareholders in the education services provider to 100,000.

-- Painthouse Co. Ltd. Q> The Jasdaq Securities Exchange said on Thursday it would delist Painthouse on July 9, following an announcement by the company that it corrected an earnings report for the year to August 2005 which showed its debt had exceeded capital.

Reuters