JGB market mood improves but still negative - Reuters survey

TOKYO, Dec 3 (Reuters) - A weekly gauge of sentiment in the Japanese government bond market remained negative but showed a slight improvement, with benchmark yields expected to stay in recent ranges ahead of this week's auctions.

The weekly poll's JGB bull-bear diffusion index, calculated by subtracting the number of bearish market players from those who are bullish, came in at minus 16, solidly negative but improving from minus 33 in the previous week's poll.

Last week's reading was the lowest since the minus 61 marked in early July.

The Ministry of Finance will offer 2.3 trillion yen of 10-year bonds on Tuesday and 700 billion yen of 30-year bonds on Thursday.

The median forecast for the 10-year JGB yield for the end of this week was 0.720 percent, above Friday's closing level of 0.705 percent. Late on Friday, the 10-year yield briefly dipped below the 0.70 percent level to 0.695 percent, its lowest since June 2003.

Sentiment deteriorated last week ahead of the general election on Dec. 16, at which the ruling party is expected to fare poorly. Main opposition leader Shinzo Abe, a front-runner to be Japan's next prime minister, has called on the Bank of Japan to take more drastic easing steps, which has pressured the yen as well as prices of superlong JGBs.

The online survey of 95 JGB market participants from major institutions received 37 responses, for a response rate of 38.9 percent. These included 18 responses from "real money" investors from institutions such as banks, pension and investment funds and insurance companies.

The survey was conducted from Friday to 8:00 a.m. on Monday (2300 GMT on Sunday).

On Monday morning, the benchmark 10-year JGB futures price shed 0.03 point to 144.83, after earlier touching 144.90, its highest level since June 2003.

The current 10-year cash JGB yield added half a basis point to 0.710 percent.

(Reporting by Yoshiyasu Shida; Writing by Lisa Twaronite; Editing by Eric Meijer)