* Automakers down, cut to "sell" by Citigroup
* Nikkei to trade between 9,500-9,800 this week -analyst
* Tokyo Elec surges, reconstruction-related stocks higher
* Oil, resource stocks lend support
* Nomura cuts Topix target
By Antoni Slodkowski and Ayai Tomisawa
TOKYO, April 11 (Reuters) - Tokyo stocks slipped on Monday,
coming off a one-month peak hit the previous session, after
Citigroup slashed ratings on major automakers to "sell", saying
the impact of last month's earthquake had yet to be fully priced
in.
Buying in post-quake outperformers, such as reconstruction-
and oil- related stocks helped the Nikkei stay above its
closely-watched 25-day moving average at 9,677. The average was
pierced last Friday for the first time in over a month.
The Nikkei has recouped about two-thirds of the ground lost
since the March 11 earthquake and tsunami, but analysts said
from now on potential gains will likely be hard-won.
"The market will stay trapped in its recent range
until the earnings season kicks off in early May," said Norihiro
Fujito, senior investment strategist at Mitsubishi UFJ Morgan
Stanley Securities, adding that traders will look for early
clues about the damage to the global supply chain in U.S.
corporate results as Apple's , which is due to come out before
Japanese earnings.
"But the real impact can only be fully priced in once
we see the figures here. Until then the volumes will stay thin,"
he said.
By midafternoon, the benchmark Nikkei fell 0.5
percent or 52.17 points to 9,715.91.
Immediate resistance looms at the benchmark's 200-day moving
average at 9,816, which the market has unsuccessfully tested
twice since the quake.
The broader Topix was 0.2 percent lower at 851.52.
Underscoring concerns over long-term impact of the quake on
Japanese shares, Nomura Securities cut its Topix target
for end-2011 to 1,000 from 1,100 in a report issued late last
week.
AUTOS FALL
Automakers extended their heavy post-quake losses with
Toyota Motor Corp shedding 2.4 percent to 3,260 yen
after it was cut to "sell" from "neutral" and its target share
price slashed to 2,440 yen from 4,140 yen, according to the
Citigroup report obtained by Reuters.
"We do not think the fall in earnings and slowness of the
recovery have been fully priced in yet," analyst Noriyuki
Matsushima wrote.
Nissan Motor Co dropped 2.2 percent to 698 yen
after being cut to "sell" from "buy" and its target share price
was almost halved to 650 yen. Honda shed 1.8 percent to 2,916
yen after being downgraded to "sell" from "buy". Its target
share price was also nearly halved, to 2,470 yen.
Japan's top automakers plan to resume production at all
domestic factories in stages starting on Monday, but output
levels will be at half of original plans and depend on the
availability of parts and power.[]
EARNINGS SETTING TONE
Analysts said the Nikkei benchmark is expected to trade
between 9,500-9,800 this week although first-quarter U.S.
corporate earnings kicking off this week might change that.
"If such companies as Alcoa cheer the market and provide
evidence of a U.S. economic recovery, the Nikkei may top that
range," said Yumi Nishimura, a senior market analyst at Daiwa
Securities.
Aluminum company Alcoa Inc is scheduled to
report first-quarter earnings later on Monday, and others
reporting this week include JPMorgan Chase & Co , Bank of
America Corp and Google Inc .
Shares of oil and gas developers Inpex Corp and
Japan Petroleum Exploration Co (Japex) rose after U.S.
benchmark oil futures hit their highest level in nearly 2-1/2
years on Monday, boosted by a weak dollar and the war in Libya.
Inpex rose 2.2 percent to 649,000 yen, while Japex gained 2
percent to 4,165 yen.
Shares of Tokyo Electric Power Co surged 13 percent
to 475 yen, adding to a 24 percent surge on Friday in a rally
triggered in part by Mizuho Securities reiterating its
"outperform" rating on the battered stock. []
The biggest post-quake gainers, reconstruction-related stocks
kept climbing, with contractor Kajima Corp gaining 1.8
percent to 231 yen and Shimizu Corp advancing 1.4
percent to 359 yen. The firms gained 8 percent and 12 percent
respectively after the quake, while the Nikkei lost 7 percent.
Electronics conglomerate Toshiba Corp jumped 4.2
percent to 402 yen, after analysts at Deutsche Bank and MF
Global said negative sentiment surrounding the company's nuclear
business, triggered by the crisis at the Fukushima nuclear
plant, had gone too far.
Earnings from NAND flash memory chips used in smartphones and
tablets are expected to remain healthy, both analysts said.
(Editing by Edwina Gibbs)
