Nikkei set to climb as Greece fears ease

TOKYO (BestGrowthStock) – Japan’s Nikkei average is likely to edge higher on Monday and may test resistance at just under 11,100, with exporters set to benefit after the dollar rose to a two-week high and Wall Street hit a 19-month high.

Toyota Motor Corp (7203.T: ) may draw attention after the Nikkei business daily reported the automaker is expected to have posted an operating profit of as high as 50 billion yen ($532.4 million) for the past financial year, higher than the 31.5 billion consensus from Thomson Reuters I/B/E/S.

An easing in worries about debt-laden Greece is also likely to contribute to positive market sentiment, with the benchmark Nikkei (.N225: ) poised for a rebound after losing 1.7 percent on the week, market players said.

“A lot of last week’s worrying factors have improved — nothing much came out of G20, and it appears that Greece will be receiving aid,” said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

“Given the generally improving global economy and expectations for Japanese earnings, which move into high gear this week, we can look for broad rises today.”

Exporters such as Canon Inc (7751.T: ) are likely to gain on the weaker yen, with resource-linked shares also set to rise after oil gained to above $85 a barrel. Investors fret about a stronger yen because it eats into exporter profits when repatriated.

The dollar was up 0.1 percent at 94.10 yen after hitting a two-week high of 94.32 yen on Friday, when the euro gained against the greenback as Greece sought to activate a financial aid package while Germany said it was ready to make a commitment to support the debt-laden country.

Market players said the Nikkei will move between 10,900 and 11,100 and may try resistance at the level of its 25-day moving average, currently at just under 11,100. But it could lack impetus to break solidly above it ahead of key results due out this week.

Canon will report first quarter results after the bell on Monday and is expected to report a quadrupling of quarterly profit on solid demand for digital cameras and printers. It may also raise its full year outlook.

In a sign the market is likely to open higher, Nikkei futures traded in Chicago closed at 11,030, up 0.7 percent from the Osaka close.

Wall St hits 19-month high on healthcare, energy (.N: ) > Euro gains vs dollar on Greek aid, German support (USD/: ) > Prices ease as economic data brightens (US/: ) > Gold hits

1-week high on uncertainties over Greece (GOL/: ) > Oil rises above $85 on strong U.S. economic data.

STOCKS TO WATCH

— Toshiba Corp (6502.T: ), IHI Corp

Toshiba and IHI will form a joint venture later this year to make parts for nuclear power plants, the Nikkei business daily reported on Monday.

— KDDI Corp

KDDI on Friday forecast operating profit of 445 billion yen for the financial year ending March 2011, a rise of 0.3 percent from the previous year but below the 478 billion yen predicted by a Thomson Reuters I/B/E/S poll of 7 analysts.

— Alps Electric

Alps Electric on Friday hiked its operating profit estimate for the business year just ended to 4 billion yen from 1.5 billion yen in the previous forecast, citing greater demand for products including auto-linked parts in particular.

The forecast beats a consensus of 1.8 billion yen from 12 analysts polled by Thomson Reuters I/B/E/S.

— Astellas Pharma Inc

Japan’s No.2 drugmaker, Astellas on Friday extended the period of its tender offer for OSI Pharmaceuticals (OSIP.O: ) for the second time, as OSI shares have stayed well above the price touted by Astellas.

The Japanese firm pushed back the deadline of the $3.5 billion unsolicited offer to May 17 from April 23, after earlier revising it from March 31.

— Sharp Corp (6753.T: ), Panasonic Corp (6752.T: ), Fujitsu (6702.T: ) and NEC

Four major Japanese electronics companies will standardize their core software platform for next-generation cellphones aimed at reducing costs and raise competitiveness, the Nikkei business daily reported on Sunday.

The firms — Sharp, Panasonic, Fujitsu, and NEC — will apply the software system, used to drive animation and music, in the next-generation cellphones developed by NTT DoCoMo (9437.T: ), the newspaper reported with citing any sources.

(Reporting by Elaine Lies; Editing by Edwina Gibbs)

Nikkei set to climb as Greece fears ease