February 3, 2017 / 3:16 AM / a year ago

Nikkei edges down in choppy trade; bank shares outperform

* Nikkei so far down 3.2 pct for the week

By Ayai Tomisawa

TOKYO, Feb 3 (Reuters) - Japan’s Nikkei edged down in choppy trade on Friday, as investors awaited the release of the U.S. monthly jobs report that will set the tone for the Federal Reserve’s policy outlook, while bank stocks outperformed on higher yields.

The Nikkei dropped 0.4 percent to 18,843.67 points in mid-morning trade after flirting with positive territory. The benchmark index has fallen 3.2 percent so far this week.

U.S. nonfarm payrolls data is due out later on Friday and is expected to show employers added 175,000 jobs in January, according to the median of 102 economists polled by Reuters.

The market was also closely watching individual earnings releases, with sentiment so far generally positive, analysts said. Many companies have raised their full-year profit forecasts due to a weakening yen.

“So far, investors seem happy with companies’ third quarter earnings,” said Yutaka Miura, a senior technical analyst at Mizuho Securities.

But he also said the yen would likely be volatile due to concerns over U.S. President Donald Trump’s trade and immigration policies.

“There is still uncertainty in developments in dollar-yen levels, so we can’t stay too optimistic about the current quarter,” Miura said.

Shares of Sony Corp jumped 6 percent, as its mainstay semiconductor business offset a $1 billion writedown in its picture business.

Investors expect Sony to grow in such areas as semiconductors, games and entertainment, with traders saying the company’s mid-term strategies look promising despite the problems at its picture business.

Bank stocks outperformed after the 10-year benchmark JGB yield rose to as high as 0.150 percent, its highest since late January 2016. Mitsubishi UFJ Financial Group Inc rose 1.4 percent and Mizuho Financial Group Inc gained 1.1 percent.

The broader Topix was flat at 1,510.83 and the JPX-Nikkei Index 400 shed 0.1 percent to 13,538.85. (Editing by Randy Fabi)

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