Tokyo stocks seen rebounding, techs to gain

TOKYO, Jan 12 (Reuters) Tokyo stocks are expected to rise for the first time in three sessions on Friday, with shares of technology firms such as TDK Corp. gaining ground after the yen fell to its lowest level in more than a year, boosting expectations of higher profits abroad.

Nikkei futures contracts pointed to a rise in the market. In Chicago, Nikkei futures expiring in March finished at 17,035, 175 points above their close in Osaka ''The weaker yen is a plus for technology companies,'' said Hiroyuki Nakai, chief strategist at Tokai Tokyo Securities.

The yen was at 120.41 to the dollar in early Asian trade after falling as low as 120.64 in the previous session, its lowest in more than a year.

A weaker yen is a boon for companies that make the bulk of their sales abroad because it boosts profits when earnings from abroad are brought home.

Technology stocks are also likely to benefit from the view that they are undervalued, having lagged the broader market, Nakai said.

The Nikkei is likely to move between 16,800 and 17,000 on Friday, market participants said. The benchmark fell 0.62 percent on Thursday, hitting its lowest close since Dec. 19.

U.S. stocks rose on Thursday, with the Nasdaq Composite Index rising 1 percent to hit a six-year high.

STOCKS TO WATCH -- Fast Retailing Co. T> Fast Retailing, the operator of Uniqlo casual-wear shops, said on Thursday its quarterly profit rose 2 percent, but it lowered its full-year forecast by 8 percent after discount sales hurt its profitability.

-- KDDI Corp.

KDDI signed up more mobile phone users in Japan last month than bigger rival NTT DoCoMo Inc. and newcomer Softbank Corp. for the fifth straight month, company data showed on Thursday.

-- Daiei Inc. T> Daiei Inc, a major supermarket chain operator, said on Thursday it had lowered its forecast for group recurring profit in the year to Feb. 28 to 33.50 billion yen from 40.00 billion.

Reuters AD VP0702