Nikkei down 1pct on techs,long-term players eye BOJ

Tokyo, July 13: The Nikkei average fell for a third straight day on Thursday, losing 0.99 percent as technology firms such as Tokyo Electron Ltd. fell on worries about earnings and discount retailers such as Yamada Denki Co. Ltd. lost ground on news a rival is to list.

While share prices have factored in a widely expected interest rate hike by the Bank of Japan on Friday -- the first in six years -- the pace of further hikes and the impact they may have on the yen are unclear, putting long-term investors mostly on the sidelines, analysts said.

Signs of weak quarterly earnings from U.S. technology heavyweights also hurt traders' appetite.

''One thing to worry about now is that growth in the U.S. economy and earnings do not look strong in the April-June quarter,'' said Jun Nishizaki, chief portfolio manager at Nissay Asset Management.

The Nikkei fell 151.37 points at 15,097.95, its lowest close since June 28. Earlier it had risen as high as 15,370.35 after reversing opening falls as low as 15,053.61.

The broader TOPIX index was 0.81 percent lower at 1,551.03.

Tokyo Electron, the world's second-biggest chip equipment maker, dropped 4.5 percent to 7,470 yen as caution over the sector's earnings spread after negative reports by some analysts on Apple Computer Inc. and Dell Inc.

''Concerns about earnings are giving a (negative) underlining note to the market as U.S. earnings for the latest quarter do not sound great,'' said Yutaka Shiraki, a senior strategist at Mitsubishi UFJ Securities.

''Neither LCDs nor PCs look good. The mobile phone sector seems also to be suffering from a temporary setback in demand.'' Quarterly earnings from Samsung Electronics Co. Ltd. were eyed as the world's biggest memory chip maker appears set to report a 7 percent fall in quarterly profit on Friday on shrinking margins in mobile phones and flat screens, according to analysts polled by Reuters.

Toshiba Corp., the world's second-biggest maker of NAND-type chips, which are used in equipment including Apple Computer's iPod, slid 2.1 percent to 708 yen.

Hoya Corp., a major glass manufacturer for PCs and flat-panel TVs, lost 3.9 percent to 3,710 yen, extending falls into a fifth session.

News this week that LG.Philips LCD Co. Ltd. of South Korea reported a record quarterly loss and cut capital expenditure for this year by almost 30 percent cast a shadow over the liquid crystal display (LCD) sector.

Yamada Denki, Japan's top discount retailer of consumer electronics, lost 2.9 percent to 10,240 yen. Shares of similar retailers also fell after news of rival Bic Camera Inc.'s listing fuelled concerns that investors in the sector would switch to the No. 5 player.

In contrast, Shin-Etsu Chemical Co. Ltd., the world's biggest silicon wafer maker, advanced 2.2 percent to 6,460 yen on strong quarterly earnings.

Takefuji Corp. gained 4.8 percent to 6,120 yen after a Canadian investment firm raised its stake in the consumer lender, helping restore some market confidence in the consumer financing sector.

Trade volume was relatively active with 1.73 billion shares changing hands on the Tokyo exchange's first section, just above the 25-day moving average of 1.71 billion shares.

Decliners beat advancers by a ratio of more than three to one.

Reuters