Japanese share prices could tread water this week as jitters over US earnings reports and economic data dampen an otherwise upbeat mood, analysts said.
"The overall tone of the Tokyo stock market will be one of pause mode but shares will stay firm this week," said Hiroyuki Nakai, chief strategist at Tokai Tokyo Research Center.
He said that Japanese shares would be influenced mainly by overseas factors, with leading US corporations including giant chipmaker Intel, IBM, Motorola and Yahoo due to announce third quarter earnings this week.
Investors will also look to the US producer price index for September on Tuesday for clues on the outlook for the US economy.
The consumer price index also due to be released on Tuesday and Beige Book due out Wednesday will add to the picture.
"If Intel's earnings report is positive, it will push up high-tech sector," said Fumiaki Nakanishi, head of market research at SMBC Friends Securities.
"Domestic related shares such as real estate sectors are expected to be higher this week," Nakanishi added.
Both analysts said that the market will be closely watching developments in the media sector after an announcement by Rakuten, the Japanese online shopping mall, that is has proposed a merger to Tokyo Broadcasting System.
Also drawing interest is a push by a investment fund Murakami Fund for Japanese professional baseball Hanshin Tigers Baseball Club to be listed on the stockmarket. The investment fund holds a stake of over 39 percent in Hanshin Electric Railway, which owns the baseball club.
Nakai expects the Nikkei-225 index to trade between 13,000 and 13,600 this week and Nakanishi forecast between 13,300 to 13,800.
For the trading week ending October 14, the Tokyo Stock Exchange's benchmark Nikkei-225 index gained 192.80 points or 1.46 percent to 13,420.54.
The broader TOPIX index of all first section shares rose 25.41 points or 1.85 percent during the week to close at 1,397.93.
Shares in Rakuten rose 4,800 yen or 5.78 percent to 87,800 yen. Tokyo Broadcasting System gained 550 yen or 16.98 percent at 3,790 yen.
Japanese telecommunications giant KDDI and Tokyo Electric Power announced a deal Thursday to merge their telecoms operations with the aim of challenging the dominance of industry leader NTT.
KDDI climbed 31,000 yen or 4.77 percent to 681,000 yen and Tokyo Electric Power Company added 65 yen or 2.30 percent to 2,885 yen.
NTT lost 2,000 yen or 0.37 percent to 536,000 yen.