Tokyo stocks seen moving higher on yen

Tokyo, May 8: Tokyo stocks are seen moving higher on Tuesday with investors buying exporters such as Canon Inc.

encouraged by a softer yen and shares with consolidation hopes including steel following a trend on Wall Street.

Another focus in the market may be Mitsubishi Heavy Industries Ltd. The Nikkei business daily said on Tuesday that Japan's biggest heavy machinery maker will start mass producing organic electroluminescent lighting panels in 2009.

''The market is likely to continue its climb. As Japanese stocks are still laggards compared with major overseas markets, it's not overheated yet and pessimistic views on earnings here have receded,'' said Hiroichi Nishi, general manager of equity marketing at Nikko Cordial Securities.

He said shares of firms about which there is talk of mergers and acquisitions are also likely to gain after news of the billion bid by Alcoa for Canada's Alcan Inc.

Pittsburg-based Alcoa, the world's largest aluminium company, rose 8 percent to push the Dow and the S&P 500 higher, leading the latest round of takeover deals that have lifted the market in recent months. For details, see In New York, the dollar edged down 0.1 percent to 120.07 yen on Monday.

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

Nikkei futures pointed to a slight fall in Tokyo stocks.

Contracts expiring in June closed at 17,675 in Chicago on Monday, down 15 points from their close in Osaka The Nikkei is likely to move between 17,600 and 17,800 on Tuesday, market participants said.

The benchmark rose 1.58 percent on Monday to 17,669.83, its highest close since April 11.

In New York, the Dow closed at a record high on Monday for the fifth session in a row, up 0.36 percent to end at 13,312.97.

The Standard&Poor's 500 Index advanced 0.26 percent to finish at 1,509.48.

Japanese companies scheduled to report results on Tuesday include Asahi Kasei Corp. and Olympus Corp.

Stocks To Watch

Daiichi Sankyo Co. Ltd.

Daiichi Sankyo, Japan's second-largest drug maker, is likely to book a 12 percent rise in pretax profit this business year, helped by strong demand for its hypertension drug, the Nikkei said on Tuesday.

-- Telewave Inc., Justplanning Inc.

Telewave, which offers management consultancy services through the Internet, said on Monday it and Justplanning, which develops systems for restaurant operators, have scrapped their tie-up plan.

It said they had hoped to expand business by combining their customer data bases and sharing knowhow, but the plan did not yield as much synergy effect as expected.

Reuters>