RTTNews - Shrugging off negative overnight cues from Wall Street and a weak start, the Japanese market rallied higher on Wednesday morning with investors going in for some bargain hunting after recent losses. However, with stocks facing stiff resistance at higher levels, the market has pared most of its gains in subsequent trades.

The benchmark Japanese index Nikkei, which rose to 9,828.86 after opening at 9,706, is currently up with a modest gain of 23.57 points or 0.24% at 9,776.45.

Real estate, bank and oil stocks are among the gainers, while machinery, technology and communications stocks are trading weak.

Automobile stocks Toyota Motor, Suzuki Motor, Nissan Motor and Mitsubishi Motors are trading higher.

Among bank stocks, Resona Holdings, Sumitomo Mitsui Financial Group, Shizuoka Bank, Mitsubishi UFJ Financial, Fukuoka Financial, Bank of Yokohama, Sumitomo Trust and Banking, Chiba Bank, Mizuho Financial Group and Chuo Mitsui Trust Holdings are all trading notably higher.

The U.S. dollar traded around the 96 yen line early Wednesday in Tokyo, down from its levels in New York overnight. The dollar fetched 95.97-96.02 yen earlier in the day against 96.33-43 yen in New York and 96.59-62 yen in Tokyo at 5 p.m. Tuesday.

In corporate news, Kao Corp. expects its operating profit to decline by 9% to around 16 billion yen for the year ending March 2010. Sales at Kao's beauty care business, which includes subsidiary Kanebo Cosmetics Inc., are seen slipping 3% to 572 billion yen. The company's stock is trading flat at present.

Meanwhile earnings are likely to remain flat at Shiseido Co., a close rival of Kao Corp., and rise at three smaller rivals for the year ending March 2010. Shiseido is trading modestly lower this morning.

Other markets in the Asia-Pacific region are mostly trading in the red. The Australian market is trading lower, with its key indices S&P/ASX 200 and All Ordinaries drifting down by nearly 1.25%. The benchmark indices of New Zealand, Korea and Singapore are also trading lower by 0.4%-0.5%, while the Shanghai Composite index is down with a modest loss. Taiwan has bucked the trend and is trading with modest gains.

Stock markets across the Asia Pacific region had ended Tuesday's trading on the downside. Japan's benchmark Nikkei 225 Index closed down by 2.9 percent and Hong Kong's Hang Seng finished down by 1.8 percent.

U.S housing starts rose at a better than expected annual rate, but lower industrial production on the back of a sharp drop in capacity utilization and a decline in core producer prices triggered fairly heavy selling on Wall Street on Tuesday.

The major averages ended the session almost near the day's lows. The Dow closed down by 107.46 points or 1.3 percent at 8,504.67, the Nasdaq closed down by 20.20 points or 1.1 percent at 1,796.18 and the S&P 500 closed down by 11.75 points or 1.3 percent at 911.97.

Major European markets turned in a mixed performance. While the German DAX Index and the U.K.'s FTSE 100 Index both finished just above the unchanged line, the French CAC 40 fell by 0.2 percent.

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