* Nikkei snaps 5-day winning streak
* Tax hike delay priced in, raises hopes for measures - traders
* Monetary easing hopes trigger positions in value shares - traders
* SoftBank rises on plan to sell Alibaba stake
By Ayai Tomisawa
TOKYO, June 1 (Reuters) - Japan's Nikkei share average fell on Wednesday and looked set to snap a five-day winning streak as losses on Wall Street soured sentiment and a stronger yen triggered profit-taking.
The Nikkei was down 0.6 percent to 17,130.05 points by late morning.
Defensive stocks underperformed. The utility sector was the worst performer, down 2 percent. Tokyo Electric Power Co shed 1.7 percent and Tokyo Gas declined 2.5 percent.
Exporters were mixed, with Toyota Motor Corp rising 0.6 percent, Honda Motor Co falling 1.0 percent and Panasonic Corp dropping 1.5 percent.
The dollar fell 110.60 yen per dollar, compared to Monday's one-month high of 111.455 yen.
Traders said that the market will likely be sluggish throughout the day, as the Nikkei has stayed above what was said to be the immediate resistance level of the 17,000-mark.
"The weak-yen trend has paused, so investors are reluctant to chase the market higher for now," said Isao Kubo, equity strategist at Nissay Asset Management, adding that trading is also expected to stay subdued.
Prime Minister Shinzo Abe is expected to announce later in the day that the government will delay a scheduled sales tax hike by two-and-a-half years.
Market players said that the news' impact on the market should be limited, but said that expectations for more public spending and the Bank Of Japan to ease monetary policy are rising.
"The market is demanding," said Yoshinori Shigemi, global market strategist at JP Morgan Asset Management. "Once it prices in the tax hike delay, it quickly focuses on whether there will be any measure to shore up the economy and tackle weak consumption."
Traders also said that with rising hopes for more easing, investors are taking positions on "cyclical and value stocks," such as exporters with relatively low price-to-earnings ratios which include Nissan Motor Co, up 0.2 percent, Hitachi Ltd and Sumitomo Chemical Co, which were flat.
SoftBank Group Corp climbed 3.5 percent after it said it will sell at least $7.9 bln of its shares in Chinese ecommerce company Alibaba Group Holding Ltd.
The broader Topix fell 0.5 percent to 1,373.28 and the JPX-Nikkei Index 400 declined 0.5 percent to 12,385.97. (Editing by Kim Coghill)