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Nikkei edges up after U.S. jobs data eases worries over Fed taper talk

TOKYO, June 7 (Reuters) - Japan’s Nikkei share average inched higher on Monday after a U.S. jobs report eased concerns over early tapering from the Federal Reserve, but gains were limited by heavy profit-taking.

The Nikkei share average rose as high as 1.0% to reach a nearly four-week high in early trading, but gave up most gains to last stand at 28,990.66, up 0.17%.

The broader Topix dipped into negative territory, down 0.07% at 1,957.81, after scaling a two-month intraday high earlier in the session.

The U.S. economy added 559,000 nonfarm payrolls in May, data on Friday showed, a tad below economists’ forecast of 650,000, reducing expectations of an early tapering in the Fed’s asset purchase.

“The jobs report would not prompt the Fed to hasten discussion on tapering,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

“But we are seeing quite a lot of profit-taking after the Nikkei rose above 29,000. You cannot avoid the impression that Japanese shares are struggling to keep up with U.S. shares.”

The reduced bets on the Fed’s tapering boosted tech stocks, with electronic parts makers Ibiden rising 4.2% and TDK Corp adding 2.8%.

Shippers benefitted from global bullish sentiment, rising 2.5% to a 10-year peak, with Nippon Yusen hitting a 12-year high.

Rival Kawasaki Kisen jumped 4.2%, while Mitsui OSK Lines added 2.4%.

However, profit-taking sank steelmakers, which had risen sharply this year on signs of a global recovery.

The steelmaker subindex dropped 4.3%, with Nippon Steel losing 5.3%, JFE Holdings shedding 6.4% and Kobe Steel falling 4.8%.

Hospitality shares, which had gained on Japan’s accelerated vaccine roll-outs, also lost traction, with department store operator Takashimaya dropping 2.4% and Isetan Mitsukoshi edging down 1.7%.

Bank shares lost 1.0% as U.S. bond yields eased to near their lowest levels on the payrolls data.

Real estate investment trusts (REITs) maintained a bull run, with TSE REIT index up 0.5% at a 15-month high. (Reporting by Hideyuki Sano; Editing by Ramakrishnan M.)

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