Tokyo stocks to open lower, commodity prices weigh

By Staff
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TOKYO, June 13 (Reuters) Japanese stocks are seen opening lower on Wednesday following a fall in U.S. stocks, while metal shares such as Sumitomo Metal Mining Co. Ltd. could come under pressure following a slide in metal prices.

A sharp drop on Wall Street, in part due to a rise in bond yields to their highest in five years, stoked fears that higher borrowing costs could cut into corporate profits and choke off growth in a key market for Japanese products.

''I'm seeing some equity sell-offs as global money that has been going into investment is gradually unwinding on worries that higher borrowing costs could cut into corporate profits,'' said Norihiro Fujito, general manager of Mitsubishi UFJ Securities' investment research and information division.

''The fall in commodity prices is another point about which we have to be careful.'' On Tuesday, nickel fell more than 6 percent and copper shed more than 2 percent after a slowdown in Chinese imports and a fall in global equity markets dampened sentiment, analysts and traders said.

Fujito said investors will pay close attention to U.S.

producer and inflation prices, on Thursday and Friday respectively, as interest rate concerns are not temporary.

Nikkei futures point to a fall in share prices. Contracts traded in Chicago finished the previous session at 17,680.00, down 120 points from the close in Osaka The benchmark Nikkei average ended the previous session down 0.41 percent to end at 17,760.91.

U.S. stocks tumbled on Tuesday with the Dow Jones industrial average down 0.97 percent to end at 13,295.01.

STOCKS TO WATCH -- Nippon Steel Corp. and other steelmakers Nippon Steel and Toyota Motor Corp. have agreed to hike prices for steel materials used to make auto parts by more than 10 percent, the Nikkei business daily reported on Wednesday.

-- Honda Motor Co. T> Honda will introduce fuel-efficient passenger cars with diesel engines in the Japanese market by 2009, a first for a Japanese automaker, the Nikkei reported.

-- Noritz Corp. T> Noritz, a maker of boilers and air-conditioning equipment, said on Tuesday it will examine free of charge about 130,000 of its water gas heaters due to concern about gas leaks.

Noritz said it sold 440,000 of the water gas heaters between 1989 and 1994, and estimates about 130,000 units are still in use.

-- CSK Holdings Corp. T> CSK, an information services company, lifted its group net profit forecast on Tuesday for the year ending March 2008 to 20 billion yen, up 11.1 percent from its previous forecast after winning some court rulings regarding taxes.

-- Toshiba Corp.

Toshiba lowered its sales target for high definition DVD players and recorders on Tuesday on slower-than-expected unit sales in the U.S., putting a damper on Toshiba's prospects in one of its growth businesses.

-- Mitsui&Co and Marubeni Corp. The two companies said on Tuesday they had agreed to combine their liquefied petroleum gas (LPG) businesses as early as April 2008 in the latest shake-up in the shrinking industry.

-- NTT Data Corp., Hitachi Ltd. T> Japan Post has awarded a consortium including NTT Data and Hitachi Ltd. a 1 million deal to supply the core computer system to Yucho Bank, which will be created through the privatisation in October of the postal organisation.

-- Accordia Golf Co. T> The president of Accordia, a Japanese golf business floated by Goldman Sachs, told Reuters its profit would surge 70 percent over four years as it acquires more courses and diversifies into driving ranges.

Reuters DKS VP0550

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