* Profit-taking pressures market after 10-mth closing high
* Eyes on Japan's Aug 30 election, post-election politics
By Aiko Hayashi
TOKYO, Aug 27 (Reuters) - Japan's Nikkei average fell 1.6
percent on Thursday after hitting a 10-month closing high the
previous day, with exporters such as Canon Inc <7751.T> losing
steam, while trade remained cautious ahead of Sunday's election.
Market players said investors have factored in a big win by
Japan's opposition Democratic Party in the Aug. 30 national
election and their focus is now shifting to the post-election
situation, including who will be the next finance and economy
ministers.
"There's a sense of buying fatigue among investors globally
and that is leading to profit-taking," said Tsuyoshi Segawa, an
equity strategist at Mizuho Securities.
"The external environment that had helped produce gains in
the market has started showing signs of waning. The U.S. market
could be entering a correction phase and the direction of Chinese
stocks remains uncertain."
In moderate trade, the benchmark Nikkei <> shed 168.72
points to 10,470.99, after rising 1.4 percent the previous day to
score its highest close since Oct. 3.
The broader Topix <> declined 1.5 percent to 960.54.
The Democrats lead Prime Minister Taro Aso's Liberal
Democratic Party in newspaper polls ahead of the election. An
opposition victory would end more than five decades of almost
continuous rule by the LDP and raise the chances of breaking a
stalemate in a divided parliament. []
"The market has factored in a landslide victory by the
Democratic Party, but it wants to wait and see what the party
will do after the election," said Hiroichi Nishi, general manager
at Nikko Cordial Securities.
EXPORTERS WEIGH
Exporters fell, with Canon, the world's largest digital
camera maker, sliding 2.2 percent to 3,620 yen.
Kyocera Corp <6971.T> declined 2.7 percent to 7,520 yen and
TDK Corp <6762.T> shed 2.7 percent to 5,410 yen.
Tokuyama Corp <4043.T>, Japan's biggest polysilicon maker,
tumbled 9.3 percent to 662 yen after it said it plans to issue 65
million shares in a public offering and an additional 9 million
shares in an overallotment option at the end of September,
sparking dilution concerns. []
Nippon Sheet Glass <5202.T> dropped 7.8 percent to 332 yen
after Stuart Chambers said he will step down as chief executive
of the company to spend more time with his family, after a stint
of a little more than a year as one of the few foreigners to head
a Japanese firm. []
Morgan Stanley lowered its rating on the company to
"equal-weight" from "overweight," citing the uncertainty caused
by the resignation in the short term.
Dainippon Sumitomo Pharma Co <4506.T> climbed 2.7 percent to
1,007 yen after the company said its experimental schizophrenia
drug lurasidone was significantly better than a placebo in a
pivotal late-stage clinical trial. []
Temporary staffing group Pasona <2168.T> surged 7.6 percent,
or by its daily limit of 5,000 yen, to 70,800 yen after saying on
Wednesday that it was appointing Heizo Takenaka, an economist and
former Japanese cabinet minister, as chairman of its board.
Some 995 million shares changed hands on the Tokyo exchange's
first section, slightly above last week's morning average of 972
million.
Declining stocks outnumbered advancing ones by about 6 to 1.
(Editing by Michael Watson)
