TOKYO (Reuters) - Japan's Nikkei stock average slipped 0.3 percent on Thursday after weak U.S. jobs and mortgage data tempered hopes for a recovery in the global economy.
Shipping lines such as Kawasaki Kisen Kaisha Ltd (9107.T) led losses as they succumbed to profit-taking in the wake of recent strong gains. But T&D Holdings Inc (8795.T) surged 6.5 percent after UBS initiated the coverage of the insurance group with a "buy" rating.
U.S. data released on Wednesday showed the service sector contracted for an eighth straight month, half a million private sector jobs were lost in May and mortgage applications falling last week in the face of rising interest rates.
That pushed the Standard & Poor's 500 Index .SPX 1.4 percent lower but market participants said losses in Tokyo were limited as hopes for global recovery remained largely intact.
"Hopes for the economy had become too optimistic, and U.S. data yesterday provided an opportunity for profit-taking," said Yumi Nishimura, a deputy general manager of the investment advisory section at Daiwa Securities SMBC.
"But the data did not change the view that a recovery is still taking place, and investors' response has been calm."
The benchmark Nikkei .N225 fell 26.56 points to 9,715.11 in active trade after falling as low as 9,654.45. It hit an eight-month closing high on Wednesday for its sixth straight day of gains. The broader Topix rose 0.1 percent to 915.16.
The shipping sub-index .ISHIP.T has dropped 6.9 percent from an 8-month high touched on Tuesday, despite a further gain by the Baltic Exchange's main sea freight index .BADI.
The index, which gauges the cost of shipping resources from iron ore to grain, rose for its 23rd straight day on Wednesday, boosted by expectations of strong demand for commodities.
Analysts said shippers were prone to profit taking after rising ahead of others amid recent hopes for an economic recovery.
Mitsui O.S.K. Lines (9104.T) fell 2.8 percent to 684 yen, and fellow shipper Kawasaki Kisen (9107.T) lost 3.5 percent to 440 yen. Nippon Yusen (9101.T) dropped 3.7 percent to 448 yen.
But demand for resource-related shares like Sumitomo Metal Mining (5713.T) remained strong with the non-ferrous metals sub-index .INFRO.T climbing 1.2 percent to become one of the biggest gainers among the sub-indexes.
"Sustained demand for resource-related stocks helped the overall market rebound from lows," said Takahiko Murai, general manager of equities at Nozomi Securities.
T&D Holdings gained to 2,790 yen after UBS rated it a "buy" and assigned a target price of 3,400 yen, saying the insurers has focused on markets with good growth potential and has steadily improved its position in the life insurance sector.
Mitsubishi Motors Corp (7211.T) rose 7.8 percent to 165 yen after the Asahi newspaper said the automaker will release plug-in electric cars by 2013, based on its Pajero SUV.
