* Nikkei braces for fall for 2016, 1st annual fall in 5
* Takata soars on hopes it could settle charges with US
* Toshiba gains after falling about 40 pct in 3 days
By Ayai Tomisawa
TOKYO, Dec 30 Japan's Nikkei share average
dropped to a three-week low on Friday morning as investors took
profits from the recent gains on the last trading day of 2016.
Takata Corp was under the spotlight again, surging
as much as 21 percent to hit the daily limit up on news that the
company could settle criminal charges with the U.S. Department
of Justice before the Obama administration leaves office next
The Nikkei was down 0.7 percent to 19,008.16 in
midmorning trade, after falling to as low as 18,991.59 earlier,
the lowest level since Dec. 9.
The index looked set to end the year with a drop of about
0.1 percent after a more than 15 percent rally in the fourth
quarter, but it could turn around depending on trade in the
"Since Japanese stocks have risen sharply since November,
profit-taking is natural. Now people are watching whether the
Nikkei will end positive or negative for the year," said Chihiro
Ohta, general manager of investment research at SMBC Nikko
Japanese stocks have surged in the four years since Prime
Minister Shinzo Abe took office, with the Nikkei hitting an
almost two-decade high in June 2015, on hopes his Abenomics
policies of monetary stimulus, fiscal expansion and structural
reform would end decades of deflation and stagnation.
Attention has shifted to U.S. politics and economic growth
after Donald Trump's surprising election to U.S. president last
Japanese equities were buoyed by the yen's weakness against
the dollar on expectations that the incoming administration
would boost U.S. growth and stoke inflation via increased
infrastructure spending, tax cuts and reduced regulation.
"The Japanese market has been largely influenced by global
events this year such as Brexit and U.S. election. For the next
year, the market continues to prepare for risks such as whether
Trump can proceed with the policies that he has been promising,"
said Kazuhiro Takahashi, an equity strategist at Daiwa
All subsectors except pharmaceuticals were in negative
territory, with real estate, sea transport and iron stocks
Mitsui Fudosan dropped 1.7 percent, Mitsubishi
Estate shed 1.2 percent, Mitsui OSK Lines
declined 1.5 percent and Nippon Steel & Sumitomo Metal
tumbled 1.9 percent.
Exporters languished as well. Honda Motor Co
dropped 1.5 percent, Nissan Motor Co fell 1.1 percent
and Panasonic Corp declined 1.2 percent.
Toshiba Corp rebounded 7.9 percent, after
nosediving about 40 percent and wiping about $6.5 billion off of
its market value in the past three days until Thursday. The
company said earlier this week that it faces a potential
multi-billion dollar writedown.
The broader Topix dropped 0.5 percent at 1,510.31
and the JPX-Nikkei Index 400 fell 0.6 percent to
(Reporting by Ayai Tomisawa; Editing by Eric Meijer)