RTTNews - The Japanese market edged higher after a weak start on Tuesday with investors indulging in some selective buying amid hopes of an economic recovery. The mood, however, remains quite cautious ahead of monetary policy announcements and economic outlook from the Bank of Japan and the U.S. Federal Open Market Committee.

The benchmark Nikkei 225 Index, which rose to 10,561.6 earlier this morning, is currently trading at 10,537.5, up 13.3 points or 0.13% over its previous close. The index had ended up by 112.17 points or 1.08% at 10,524.26 on Monday.

Construction, real estate, pharmaceuticals, chemicals and insurance stocks are mostly trading in positive territory. Automobile, bank and non-ferrous metals are exhibiting a mixed trend. Steel, machinery and electric machinery stocks are mostly trading lower.

Shares in Chubu Electric Power Co. lost ground today after a major earthquake earlier this morning halted the firm's Hamaoka Nuclear Power Plant's No. 4 and No.5 reactors in Shizuoka Prefecture. No radiation leakage has been reported so far. However, if operations remain suspended for an extended period, the firm may be forced to increase thermal power generation, which could lead to higher fuel costs. The stock is currently trading down by about 1.5%

Shares of Toshiba Corp. moved up this morning following the firm's announcement the previous evening that it will sell hardware compatible with the Blue-ray Disc format. The company also said it had applied for membership to the Blu-ray Disc Association, which discusses and devises standards for the format. After an early surge, the stock has pared some gains and is up just modestly over its previous close now.

Transport stock Kintetsu Corp. is down by 3% following the company downgrading its group earnings outlook for the year ending March 2010. The railway operator will likely book a group net profit of 11 billion yen for fiscal 2009, down 32% on the year and 3 billion yen smaller than the previous forecast.

In the currency market, the U.S. dollar traded around the 97 yen line early Tuesday in Tokyo, down slightly from its levels in New York overnight. In early trading, the dollar fetched 96.99-97.04 yen against Monday's close of 97.12-22 yen in New York and 97.37-40 yen in Tokyo. The yen is currently trading at 96.94 to the U.S. dollar.

Among other markets in the Asia-Pacific region, Australia and Korea are trading flat. Singapore is up sharply, while Shanghai, New Zealand and Taiwan are exhibiting weakness. Stock markets across the region had largely turned in strong performances on Monday.

On Wall Street, stocks posted modest losses on Monday, as traders cashed in on recent gains amid a lack of significant moves. The decline came ahead of some key economic reports on tap for this week, including data on retail sales, industrial production and weekly jobless claims. Further, the Federal Open Market Committee will make its interest rate announcement on Wednesday, with the key fed funds rate expected to remain unchanged amid a challenging economic environment.

The Dow closed lower by 32.12 points or 0.3% at 9,337.95, the Nasdaq slipped by 8.01 points or 0.4% to 1,992.24 and the S&P 500 drifted down by 3.38 points or 0.3% to 1,007.10.

Major European markets turned in a mixed performance on Monday, with the French CAC 40 index and the German DAX index closing down by 0.5% and 0.8% respectively, while the U.K.'s FTSE 100 index rose by 0.7%.

Crude oil prices finished modestly lower amid choppy trading on Monday, but held above the US$70 per barrel mark. Traders expressed some uncertainty ahead of the Federal Reserve's interest rate decision later this week. Light sweet crude for September moved to US$70.60 a barrel, down 33 cents for the day. Prices touched as low as US$70.09 and as high as US$71.57 earlier in the day.

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