TOKYO, Sept 10 (Reuters) - Japan's Nikkei average is expectedto gain on Friday after stronger-than-expected U.S. data onjobless benefits and trade raised hopes the tepid economicrecovery would accelerate.
Nikkei futures traded in Chicago closed at 9,150, up 1.3percent from the Osaka close.
But market players said banking stocks may come underpressure following a newspaper report about the possiblebankruptcy filing of a domestic bank and Deutsche Bank's weighinga share sale of up to $11.4 billion.
"The market will likely draw support from gains in U.S.stocks and calming moves in the currency market for now," saidKazuhiro Takahashi, general manager at Daiwa Securities CapitalMarkets.
Incubator Bank of Japan will tell the Financial ServicesAgency on Friday that its earnings report for the half year toSeptember will likely show a negative net worth of 150 billionyen ($1.79 billion), which is expected to prompt the FSA todeclare it bankrupt, the Nikkei business daily reported.
The bank's depositors are expected to be refunded only up to10 million yen in principal plus earned interest, marking thefirst time that a cap on deposit insurance has been applied inJapan, the paper said.
"Although its impact on the overall market is likely to belimited, the news about a payoff will likely alarm investorsabout the financial sector, coupled with Deutsche Bank'sfinancing news," Takahashi said.
The benchmark Nikkei is likely to move between 8,900 and9,200, market players said. It rose 0.8 percent on Thursday to9,098.39, pulling away from a 16-month low of 8,796.45 hit onSept. 1.
U.S. stocks edged up after new U.S. claims for unemploymentinsurance fell more than expected last week to their lowest levelin two months.
The U.S. trade deficit narrowed more than forecast in July asexports shot to the highest level since August 2008, painting arosier picture for economic growth.
On Friday, investors in Tokyo are closely watching thesettlement price of Nikkei futures and options contracts expiringin September.
Initial estimates by local brokerages are expected slightlyafter the market opening and the official settlement price willbe announced by the Osaka Securities Exchange after the bell.
The Nikkei average inched up on Thursday, lifted byshort-covering, but resistance loomed on technical charts,casting doubt over further gains in the Nikkei.
The strength of the yen, which remains within sight of a15-year high versus the dollar, is also likely to put a lid onfurther gains, market analysts say, keeping its weeklyperformance almost flat.
In early Asia trade, the dollar traded at 83.99 yen, withinsight of the 15-year low of 83.34 yen hit this week.----------------------MARKET SNAPSHOT @ 2310 GMT ------------
LAST PCT CHG NET CHGS&P 500 1104.18 0.48% 5.310USD/JPY 83.98 0.19% 0.16010-YR US TSY YLD 2.757 -- 0.000SPOT GOLD 1244.55 -0.30% -3.720US CRUDE 74.91 0.89% 0.660DOW JONES 10415.24 0.27% 28.23-------------------------------------------------------------> Wall St buoyed by upbeat economic data> Yen hovers near 15-year peak vs dollar; euro falls> Bonds take a hit from perky data, poor auction> Gold ends near 1-week low, safe-haven bids unwound> US oil gains, Brent spread narrows on Enbridge
STOCKS TO WATCH
-- Canon Inc
Canon said on Thursday it would spend as much as 50 billionyen to buy back its own shares between Sept. 10 and Nov. 12 toimprove its capital efficiency.
Under the plan, it will buy back as much as 1.2 percent ofits outstanding shares, it said in a statement.
-- Toyota Motor Corp and other automakers
The Japanese government said on Thursday it would turn downabout 52,000 applications received a day earlier under itscash-for-clunkers programme after hitting the budgeted amount forthe subsidies. (Reporting by Aiko Hayashi; Editing by Michael Watson)