Nikkei seen moving higher on Wall St, yen

Tokyo, Dec 12: Tokyo stocks are seen moving higher on Tuesday with investors buying exporters such as Honda Motor Co. after a fall in the yen against the dollar and gains in U.S. markets.

Investors will also likely focus on KDDI Corp. and NEC Corp. after business daily Nihon Keizai reported on Tuesday that it and a Russian long-distance telecoms provider will jointly lay undersea fibre-optic lines between Russia and Japan.

It said NEC has been awarded a contract for the work, which is expected to begin as early as next summer, and KDDI and government-affiliated Rostelecom have agreed to split costs of 5 billion yen (.83 million).

''The Nikkei is likely to rally following rises on Wall Street and Chicago futures. The yen has also hit the 117 range against the dollar,'' said Hiroichi Nishi, general manager of equity marketing at Nikko Cordial Securities. ''Investors are expected to buy exporters with good earnings records.'' Nikkei futures point to a rise in the market. December futures traded in Chicago closed at 16,650 on Monday, up 70 points from their close in Osaka The Nikkei average will likely move between 16,550 and 16,750 on Tuesday, Nishi said. The benchmark rose 0.67 percent on Monday to 16,527.99, its highest close since Oct. 27.

The dollar hit a nearly three-week high around 117.26 yen in New York on Monday. A weaker yen benefits firms that make the bulk of their profits outside Japan, as it boosts profits when earnings from abroad are brought home.

U.S. stocks gained slightly on Monday as a flurry of deal news involving companies such as American International Group Inc. spurred optimism about the economic outlook, but investors were cautious a day before the Federal Reserve's final meeting of the year.

The Dow Jones industrial average gained 0.17 percent, to close at 12,328.48, while the Nasdaq Composite Index was up 0.23 percent.

STOCKS TO WATCH

SUMCO Corp. - Japanese silicon maker SUMCO said on Monday its new share issues to help boost output would be priced at 8,878 yen per share, a 2 percent discount from its 9,060 yen closing share price on Monday.

Sony Corp. - Sony said on Monday it had sold 58,750 shares in online brokerage Monex Beans Holdings Inc., or 2.5 percent of Monex's shares outstanding, for a 3.5 billion yen profit.

TEPCO, MARUBENI - Tokyo Electric Power Co. said on Monday it and Marubeni have won an auction to buy power plants in the Philippines from U.S. electricity producer Mirant Corp.

REUTERS