UPDATE 1-Japan stocks may fall as credit worries spread

                                
  (Adds Bear Stearns sale, Fed announcement)
                                
 TOKYO, March 17 (Reuters) - Japanese stocks may fall on
Monday as credit worries spread following last week's emergency
rescue of U.S. investment bank Bear Stearns <BSC.N>, with a
stronger yen seen weighing on exporters such as Toyota Motor Corp
<7203.T>.
                                
 But the dollar began to climb after JPMorgan Chase <JPM.N>
announced that it was acquiring Bear Stearns and the Federal
Reserve cut its discount rate.
                                
 One stock to watch is Hitachi Ltd <6501.T>, which said on
Friday it would fall into a net loss for the year ending this
month, compared with its previous forecast of a net profit, hit
by the sluggish performance of its TV operations.[ID:nT305155]
                                
 "The fact that Bear Stearns ended up in that situation makes
the market inevitably wonder if there are more banks like that
out there, worsening credit fears," said Yutaka Miura, senior
technical analyst at Shinko Securities.
                                
 "If the dollar manages to recover to the 99 yen level, stocks
could rebound a bit as well. But otherwise they're looking to
test the downside, perhaps break below 12,000."
                                
 The Nikkei was expected to range from 11,900 to 12,400, with
defensive shares likely to be bought amid otherwise general
selling. The Nikkei closed on Friday at 12,241.60, its lowest
since Aug. 10, 2005.
                                
 In a sign of how the market may move, Nikkei futures traded
in Chicago <2NKc1> finished at 12,110 on Friday compared with
12,200 in Osaka <JNIc1>.
----------------------MARKET SNAPSHOT @ 2252 GMT ------------
                                
                 INSTRUMENT   LAST       PCT CHG   NET CHG
S&P 500             <.SPX>       1288.14     -2.08%   -27.340
USD/JPY             <JPY=>       98.55        -0.1%    -0.100
10-YR US TSY YLD    <US10YT=RR>  3.4716          --     0.000
SPOT GOLD           <XAU=>       1004.6       1.19%    11.800
US CRUDE            <CLc1>       109.95      -0.24%    -0.260
DOW JONES           <.DJI>       11951.09    -1.60%   -194.65
-------------------------------------------------------------
> Stocks sink as Bear Stearns reignites credit fears   [.N]
> Euro rises above $1.57 to record highs               [USD/]
> TREASURIES-Bonds soar as wounded Bear mauls stocks   [US/]
> Spot gold sets historic high above $1,000 mark       [GOL/]
> Oil slips after record week, heating oil surges      [O/R]
STOCKS TO WATCH
                                
 -- Hitachi Ltd <6501.T>
                                
 Japanese electronics maker Hitachi said on Friday it would
fall into a net loss for the year ending this month, compared
with its previous forecast of a net profit, hit by the sluggish
performance of its TV operations.
                                
 Hitachi, Japan's biggest industrial electronics company in
terms of sales, cut its net forecast for the year to March 31 to
a loss of 70 billion yen ($696 million), from a 10 billion yen
profit, falling short of a consensus forecast of a 13.8 billion
yen profit in a poll of 10 analysts by Reuters Estimates.
[ID:nT305155]
                                
 -- Nomura Holdings <8604.T>
                                
 A group of investors led by Nomura Holdings, Japan's biggest
brokerage, was chosen to take over Ashikaga Bank, ending a nearly
two-year bidding war for the right to revive the failed local
lender. [ID:nT303081]
                                
 -- Fujifilm Holdings Corp <4901.T>
                                
 Fujifilm will invest some 15 billion yen ($153 million)
to build a new plant in the Netherlands to produce components
used in offset printing in order to better take on rivals such as
Eastman Kodak <EK.N>, the Nikkei business daily said on Monday.
 (Reporting by Elaine Lies; Editing by Chris Gallagher)