Nikkei slips on profit-taking

TOKYO, Feb 13 (Reuters): Japan's Nikkei share average edged lower Wednesday as a pause in the yen's decline triggered profit-taking on exporters, while social gaming company Gree Inc tumbled after cutting its annual profit forecast. The Nikkei was down 0.2 per cent at 11,344.45 by the midday break, moving away from the 33-month high it hit a week earlier of 11,498.42. "The yen's move against the dollar prompted profit-taking on exporters. The stock market is nervously eyeing the currency moves," said Naoki Fujiwara, chief fund manager at Shinkin Asset Management. Big exporter Toyota Motor Corp, the day's third most-traded stock, shed 0.8 per cent while Sony Corp, the fourth most-heavily traded, lost 5 per cent. On the foreign exchange market, the yen held firm Wednesday, swinging sharply higher after an official from the Group of Seven (G7) said there were concerns about excessive movements in Japan's currency. The yen had weakened initially after Japanese Finance Minister Taro Aso said that a G7 statement recognised that Japan's reflationary policies are not aimed at affecting foreign exchange markets. But a G7 official later said the statement was meant to signal concerns about excessive moves in the yen, prompting a dramatic reversal in the currency. Market analysts said the underlying mood remained positive after a US Treasury official last Monday voiced support for Japan's aggressive policies to combat deflation and bolster growth. But the market may be prone to short-term volatility until the weekend, when Group of 20 (G20) finance chiefs are scheduled to meet in Moscow. "The Japanese market will likely stay sensitive to officials' comments until the G20 meeting this weekend. Any comments on foreign exchange could move the market," said Takuya Takahashi, an analyst at Daiwa Securities. However, Shinkin's Fujiwara said any negative comments from the US, which has the significant influence in the G7, could be a serious blow to market sentiment. While the Nikkei stayed in a narrow range, investors focused on individual stocks based on their earnings, such as Gree, which disappointed the market with poor earnings and a lower profit outlook. Gree dropped 16.1 per cent and was the eighth most-traded stock by turnover.