Tokyo shares outlook - Higher on Wall St gains, rate cut hopes

Tokyo shares outlook - Higher on Wall St gains, rate cut hopes

	Published : Wed, 12 Sep 2007 00:13 By : Agencies Print this Story

TOKYO (Thomson Financial) - Japanese shares may open higher on Wednesday as investors take comfort in gains on Wall Street amid growing expectations that the Federal Reserve will cut interest rates next week even after its chairman gave no clues about the central bank's intentions.

Fed Chairman Ben Bernanke did not give any indication during a speech to Germany's Bundesbank Tuesday about the Fed's next move. The Federal Open Market Committee will meet on Sept 18.

Instead, Bernanke talked about the need for countries to cooperate toward economic stability, and said that 'global imbalances' occur when countries run up trade deficits or produce big trade surpluses.

The Tokyo market's gains Tuesday showed that there is strong support for the benchmark Nikkei 225 index near 15,800 points, said Yosuke Shimizu, head of investment information at Monex Securities, which should allow it to test 16,300.

'But from a technical viewpoint, unless the index reclaims the 16,300 level, it may resume its

downturn and test 15,500-15,600 once again,' Shimizu said.

On Tuesday, the Dow Jones Industrial Average closed up 180.54 points, or 1.4 percent, to 13,308.39, while the Nasdaq composite index rose 38.36 points, or 1.5 percent, to 2,597.47.

The Chicago-traded Nikkei futures contract settled at 15,985 points, up from 15,840 at the Osaka Securities Exchange on Tuesday, suggesting a firm start for the market.

On the Tokyo bourse, the Nikkei 225 Stock Average closed up 112.70 points, or 0.7 percent, at 15,877.67, while the broader TOPIX index edged up 7.17 points, or 0.5 percent, to 1,532.39.

Ahead, the Ministry of Finance will report 10 minutes before the opening bell current account

balance for July, while the Bank of Japan will release the corporate goods price index for August.

The Brewers Association of Japan will announce shipments of beer, low-malt beer and beer-like beverages for last month, while Teikoku Databank will report the latest data on corporate bankruptcies. Also due is the consumer sentiment data for August to be released by the Cabinet Office.

Stocks to watch include Nomura Holdings Inc on a report that it and Norinchukin Bank will jointly launch a pension fund management firm specializing in private-equity investments.

Matsushita Electric Industrial Co Ltd may be active on a report that the world's largest consumer electronics maker will invest 40 billion yen over three years to hike sales in five emerging markets, including China and Russia.

Construction and mining equipment maker Komatsu Ltd may advance on a report that the company is likely to offer dividend of 20-21 yen per share for the first half to September, 7-8 yen higher than what it paid a year earlier due to robust profit growth.

(1 US dollar = 114.24 yen)

yasuhiko.seki@thomson.com

yas/ms

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