Nikkei ekes out gains in choppy trade, JAL lower
* Nikkei clings to gains in thin trade
* Eyes on movement of dollar against yen
* JAL down despite news Air France-KLM seeking stake
TOKYO, Sept 15 (Reuters) - Japan's Nikkei stock average edgedup 0.1 percent, buoyed by Toyota Motor Corp (7203.T) and otherexporters as the yen held steady against the dollar, but worriesthat it may only be a brief respite limited gains.
Japan Airlines (9205.T) failed to add to gains made theprevious day despite news that Air France-KLM (AIRF.PA) wasjoining a list of suitors seeking a minority stake in theloss-making Japanese carrier. [ID:nT194467]
"The market clearly fell too far yesterday, and we're seeingsome short covering, but this sort of drifting is likely tocontinue for some time," said Hideyuki Ishiguro, a supervisor atthe investment strategy department of Okasan Securities.
"We need to watch and see if the yen continues to be strong.Also, some investors are waiting to see what sort of policies thenew government enacts, so some may refrain from buying."
Yukio Hatoyama will take office on Wednesday after hisDemocratic Party's huge election win over the long-dominantLiberal Democratic Party.
The Nikkei business daily said on Tuesday that Hatoyama hasdecided to appoint veteran lawmaker Hirohisa Fujii as financeminister. [ID:nT190562] [ID:nT311225]
"He is a former finance minister and has experience which iswell respected by many people, so I don't think the choice of himwill rock markets," said Yasunari Ueno, chief market economist atMizuho Securities.
"We're looking at how he will wrestle with the task of comingup with the necessary funds to finance the party's pledges.
The benchmark Nikkei .N225 rose 11.64 points to 10,213.70after falling 2.3 percent the day before. The broader Topix lost 0.2 percent to 931.94.
Trade was thin and choppy, with the benchmark brieflyventuring into negative territory late in the morning when thedollar briefly fell back below 91 yen.
"Though the yen's rise appears to have halted for a while,it's hard to predict what's going to happen, and investors can'tfeel confident about the direction," said Takashi Ushio, head ofthe investment strategy division at Marusan Securities.
The dollar was up 0.1 percent at 91.02 yen JPY=.
JAL IN SPOTLIGHT
Air France-KLM (AIRF.PA) is in talks to inject hundreds ofmillions of dollars into JAL (9205.T), a source familiar with thematter said.
Delta Air Lines (DAL.N) and American Airlines (AMR.N) are inseparate 'early stage' talks with Japan's carrier. All hope togain access to its route network. [ID:nN14526558]
"I think this is a real plus, as there were some doubts aboutwhether JAL would be able to carry out its restructuring plansalone," said Marusan's Ushio.
Meanwhile, JAL plans to cut overseas flights and increasepersonnel cuts over the next three years in a bid to slashoperating costs by 30 percent, Japanese media said on Tuesday.
JAL lost 1.7 percent to 173 yen.
NEC Corp (6701.T) pared gains but still rose 0.7 percent to302 yen after Japan's No.3 handset maker said it would take overthe cellphone operations at Casio Computer Co (6952.T) andHitachi Ltd (6501.T) as the struggling sector bands together tocut costs and survive a fast-shrinking market. [ID:nT211084]
Casio shares gained 0.5 percent to 833 yen, while Hitachi wasflat. All were off earlier highs.
Exporters, which led the Nikkei higher during early trade onshort covering, pared their gains.
Canon Inc (7751.T) rose 3.5 percent to 3,570 yen, Honda MotorCo (7267.T) added 0.9 percent to 2,805 yen and Toyota gained 0.3percent to 3,750 yen.
Trade was thin on the Tokyo exchange's first section, with807 million shares changing hands, below last week's morningaverage of 1.1 billion.
Declining stocks outnumbered advancing ones, 928 to 573. (Additional reporting by Tokyo newsroom; Editing by ChrisGallagher)
Source: Reuters
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