Nikkei to rebound, eyes on yen and U.S. autos bill

TOKYO, Dec 15 - Japan's Nikkei average is set to rebound on Monday after falling more than 5 percent the previous trading day, but any advance of the yen against the dollar will likely limit gains, especially by exporters such as Canon Inc.

One stock to watch will be Toyota Motor Corp. The automaker is likely to further cut its earnings forecasts and report an operating loss of about 100 billion yen ($1 billion) in the October-March period, Japanese media reported on Saturday.

The keenly watched Bank of Japan "tankan" survey of business sentiment is due out just before the open, but market participants said bad figures had already been factored in and it was not expected to have a significant impact.

The main focus of the market will be the bailout for U.S. automakers after Wall Street rose on Friday on hopes that a lifeline for the struggling sector could still materialise.

"It seems there's a chance the U.S. government will come up with some kind of support for automakers, and the market will be watching moves in this today," said Hiroichi Nishi, general manager of the equity division at Nikko Cordial Securities.

"The other big factor will be the dollar's movement against the yen, and even though it's off last week's low the long-term trend is towards a weaker dollar."

The dollar was fetching around 90.91 yen in early Asian trade after hitting a 13-year low on Friday after the U.S. Senate rejected a $14 billion autos bailout bill.

The benchmark Nikkei is expected to move between 8,350 and 8,700. It finished Friday down 5.6 percent at 8,235.87.

Nikkei futures traded in Chicago closed at 8,715 on Friday compared with the Osaka close of 8,290 yen. > Wall St climbs on hopes for auto aid, tech support > Dollar hits 13-yr low vs yen, recovers on car hope > Bonds recover as auto uncertainty in driver's seat > Gold ends lower, platinum sinks as bailout fails > Oil down nearly $2, pares losses with Wall Street STOCKS TO WATCH

-- Toyota Motor Corp

Toyota is likely to further cut its earnings forecasts and report an operating loss of about 100 billion yen ($1 billion) in the October-March period, Japanese media reported on Saturday.

A company spokesman declined to comment.

-- Nomura Holdings Inc

Nomura said on Friday it cancelled a nearly four-year-old alliance with boutique investment bank Rothschild in October, after the Japanese brokerage purchased part of Lehman Brothers' operations.

Japan's largest brokerage had tied up with Rothschild in February 2005 to strengthen its ability to advise on mergers and acquisitions in Japan and Europe.