Nikkei edges up as Google deal lifts mobile suppliers

Japanese stocks edged higher on
Tuesday after Google Inc's plans to buy phone maker Motorola
Mobility triggered buying of some technology stocks, though
worries about the health of the U.S. economy and a strong yen
were seen limiting further gains.
" Tokyo stocks may not see heavy selling for the
time being, but investors seem unconvinced about the U.S.
economic recovery and are worried about the weak dollar trend,"
said Hikaru Sato, a senior technical analyst at Daiwa Securities
Capital Markets.
"The Nikkei may gradually recover its 25-day moving average,
but the pace of recovery can be slow."
The Nikkei average closed up 0.2 percent at
9,107.43, while the broader Topix added 0.3 percent to
779.06.
The Nikkei has shed 7.4 percent since the beginning of
August and is 5.6 percent below its 25-day moving average at
9,655.73.
Some technology stocks were lifted by news that Google
is paying $12.5 billion to buy Motorola in a
move seen driving stronger demand for suppliers of chips and
other parts for Android mobile phones.
Murata Manufacturing Co , a supplier of smartphone
parts, gained 0.9 percent to 4,920 yen. Chipmaker Elpida Memory
rose 5.1 percent to 538 yen, while Renesas Electronics
gained 1.9 percent to 549 yen.
The Nikkei is down 11 percent in 2011, underperforming a 9.1
percent fall for other Asian shares. .
Analysts said worries over the health of the U.S. economy
were weighing on Japanese shares.
Manufacturing in the New York area contracted for the third
straight month in August, data showed on Monday, tempering any
lingering hopes for a rebound in the U.S. economy in the second
half of the year.
The New York Federal Reserve's Empire State index showed the
general business conditions index fell to minus 7.72 in August
from minus 3.76 the month before. Economists polled by Reuters
had expected a reading of zero.
Some investors put money in real estate firms, seen as a
safer bet because their earnings are tied to domestic demand and
relatively immune to the strong yen. The sector has also lagged
the market, falling 20 percent so far this year.
Mitsui Fudosan , Japan's largest property developer,
rose 2.9 percent to 1,265 yen, while smaller rival Mitsubishi
Estate gained 1.6 percent to 1,231 yen.
Among other big gainers, Yamaha Motor Co rose 3.5
percent to 1,243 yen, extending gains for a second day after
Nomura Securities lifted its rating to "neutral" from "reduce",
saying the stock was no longer overvalued.
Volume was thin due to Japan's "obon" holidays, with 1.67
billion shares changing hands on the Tokyo Stock Exchange's main
board, lower than last week's average daily volume of 2.4
billion shares.