Nikkei edges up but lacks momentum on output worry

 TOKYO, April 7 (Reuters) - Japan's Nikkei average edged
higher on Thursday, rising as much as 1.1 percent at one point,
but the market ran out of steam due to the crisis at Tokyo
Electric Power Co's Fukushima Daiichi nuclear plant and
worries over lost output.	
 Strength in overseas markets the previous day encouraged
solid buying, with investors covering their positions after the
Nikkei posted losses in the last two sessions.	
 "It was about time to see some corrective buying, with
investors who have gone short this week covering their positions
ahead of tomorrow's SQ," said Takashi Ohba, a senior strategist
at Okasan Securities, referring to Friday's settlement of
futures and options, known in Japan as the special quotation or
"SQ".	
 "But today's buying is largely technical with investors
trying to square off their positions. Many players want to keep
their positions as neutral as possible because there are many
uncertainties, but the market is more likely to test the
downside."	
 The benchmark Nikkei average was up 0.5 percent at
9,629.59 by mid-morning. It briefly rose 1.1 percent to an
interday high of 9,687.18.	
 The broader Topix index rose 0.6 percent to 844.91.	
 Japanese shares are under pressure as many investors refrain
from chasing them on rallies despite the yen's fall.	
 The yen was near an 11-month low of 122.55 yen to the euro
 and a half-year low of 85.54 yen against the dollar 
 .	
 The positive effect of a weaker yen on shares of Japanese
exporters was limited due to concerns over bottlenecks and
disrupted supply chains.	
 "The market is increasingly feeling that the TEPCO nuclear
problem will take a long time. People are also unsure about
production losses. It's likely that the market could test the
Nikkei below 9,000 again," Oba said.	
 Shares in TEPCO rose as much as 5.3 percent to 355 yen on
Thursday shortly after the opening in highly volatile trade that
saw prices move in and out of negative territory.  	
Shares of the power company fell to a record low of 292 yen
on Wednesday due to concerns that it was likely to face huge
damages payments over the crisis at its stricken Fukushima power
plant.	
 Engineers pumped nitrogen gas into a crippled nuclear
reactor at the plant on Thursday, trying to prevent an explosive
buildup of hydrogen gas  as the world's worst nuclear disaster
in 25 years stirred atomic safety debate and inspections in the
United States.[ID:nL3E7F62A5] 	
 Shares in Elpida Memory gained 5 percent to 1,116
yen after the company said it had developed a 4-gigabit DRAM
chip for smart phones, joining bigger rival Samsung Electronics
 as the only producers of the large capacity
power-saving memory chip for smart phones. [ID:nL3E7F63HD]	
 Overseas investors shifted back to net buying of Japanese
equities to the tune of 144.7 billion yen ($1.69 billion) in the
week to April 2, after having sold a net 13.2 billion yen the
prior week, according to data by the Ministry of Finance.	
 Between March 13 and 19, the week right after the quake and
tsunami, foreigners logged record net buying of Japanese
equities of more than 890 billion yen. 	
 ($1 = 85.475 Japanese Yen)	
	
 (Reporting by Antoni Slodkowski and Chikafumi Hodo; Editing by
Michael Watson)	
 

Nikkei edges up but lacks momentum on output worry