Nikkei seen up slightly on U.S., high-tech firms

TOKYO, July 4 (Reuters) Japan's Nikkei average is expected to edge higher on Wednesday as high-tech shares such as Kyocera Corp. track rises in their U.S. peers, though a lack of participation from foreign investors could limit gains.

Shares of Fast Retailing Co. will be in focus after the clothing retailer said its same-store sales fell 1.3 percent in June, reflecting sluggish demand for products related to the country's ''cool biz'' campaign to promote casual clothing at work.

Analysts said they expected relatively lacklustre trade because many foreign investors will be on the sidelines ahead of Wednesday's U.S. Independence Day holiday when U.S. financial markets will be closed.

''I expect us to start higher following gains on Wall Street but then to kind of meander at slighly elevated levels,'' said Masayoshi Yano, a senior manager of investment information at Tokai Tokyo Securities.

''Many foreign investors will not be trading. There won't be enough energy in the market to stage a rally.'' The Nikkei will likely move between 18,000 and 18,300 on Wednesday after inching higher for four straight sessions. It closed Tuesday up 0.02 percent at 18,149.90.

Nikkei futures point to a higher opening. Contracts traded in Chicago finished the previous session at 18,250, up 30 points from the close in Osaka On Wall Street on Tuesday, the Nasdaq Composite Index rose 0.48 percent to a 6-1/2-year high, lifted by fresh takeover talk and after a report suggesting Apple Inc. will generate fat profit margins on its iPhone.

Nagayuki Yamagishi, strategist at Mitsubishi UFJ Securities, said investors would likely snap up high-tech shares following the Nasdaq's jump.

STOCKS TO WATCH -- Nikon Corp. T> Nikon has doubled its sales growth target for steppers next business year, helped by strong demand from makers of flash memory and DRAM, a top executive told Reuters in an interview on Tuesday.

-- Sanyo Electric Co. T> Sanyo will spend about 30 billion yen this business year to boost output of lithium-ion batteries by 15 percent to meet growing demand for the batteries in notebook computers, the Nikkei business daily reported on Wednesday.

-- Mitsui Trust Holdings Inc. T> The Japanese government will sell roughly 7 million worth of shares in the bank to recoup public funds injected in a state bailout in the late 1990s.

-- Imperial Hotel Ltd. T> U.S. fund Cerberus Capital Management LP is likely to sell its 4 million stake in the Japanese hotel, the Nikkei business daily reported in its evening edition on Tuesday.

The news sent Imperial Hotel's shares up by their daily limit of 500 yen, or 11.4 percent, to 4,880 yen on the Tokyo exchange's second section.

-- Casio Computer Co. and NTT DoCoMo Inc. T> The firms said they will form a joint venture to link cash registers with wireless electronic payment systems.

REUTERS DKS RAI0514