CORRECTED-UPDATE 1-Nikkei skids as investors book gains; Suntory shines
(Corrects company name in third paragraph to Myojo Asset Management) * Investors take profits after strong gains since Friday * Toyota gains on rosy earnings prospects pared in afternoon session * Suntory outperforms on strong earnings for Jan-Sept By Ayai Tomisawa and Thomas Wilson TOKYO, Nov 6 (Reuters) - Japanese stocks sagged on Thursday afternoon as investors closed positions following strong gains in the last three trading days, wiping out morning advances for Toyota Motor Co. The Nikkei benchmark dropped 0.6 percent to 16,826.21 by 0244 GMT. "Hedge funds are now closing positions after the Bank of Japan's additional easing. They think stocks are unlikely to rise further," said Makoto Kikuchi, CEO of Myojo Asset Management Japan. Since Friday investors have lapped up the twin catalysts of the Bank Of Japan's shock move to ease monetary policy further, as well as the Government Pension Investment Fund's decision to increase its allocation of funds to domestic stocks. The Nikkei made slim gains during Thursday's morning session, breaking through the 17,000-mark and then hovering near seven-year highs on the back of strongly performing Toyota Motor Corp shares and a weaker yen. Trading some 9 percent above its 25-day moving average of 15,578.06, some players warned that the market was overheated. "Even in a bullish environment, historical data has shown that the percentage gains showing a gap between the current level and the 25-day moving average should stay within 8 percent," said Hikaru Sato, a senior technical analyst at Daiwa Securities. Toyota shares jumped after surprising investors with an earnings upgrade, predicting operating profit of 2.50 trillion yen for the 2014 business year, up from the previously forecast 2.30 trillion yen. By 0228 GMT, Toyota shares were up 0.2 percent after advancing 1.2 percent in the morning session, when they were the most traded by turnover. "It was impressive that the automaker was able to be profitable through its value added models like Lexus hybrids," said Yoshihiro Okumura, an analyst at Chibagin Asset Management. "Toyota is also expected to post a high operating profit margin through a new platform next year, and it's a plus in the long-term." In the U.S. stocks rallied and the dollar rose as the Republicans swept mid-term elections, bolstering investor hopes for more business and energy-friendly policies. The dollar surged to a seven-year high of 115 yen, helping exporter shares, before falling away to 114.50 in the afternoon session. Gains in exporters like Nissan were pared, with the auto-maker falling 0.3 percent after rising 1.0 in the morning. One bright spot was Suntory Beverage & Food, which soared 5.4 percent after it released strong profits for the Jan-Sept period due to robust beverage sales. The broader Topix slipped 0.8 percent to 1,361.50, and the JPX-Nikkei Index 400 skidded 0.8 percent to 12,425.76. (Reporting by Ayai Tomisawa and Tom Wilson; Editing by Simon Cameron-Moore)
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