Nikkei snaps 5-day winning run on profit-taking, volume highest in 23 mths
* Market awaited Toyota earnings
* Nikkei's upside seen at 10,300 for short-term - analyst
* Hitachi sags after cutting forecast
* Panasonic shoots to one-year high
TOKYO, Feb 5 (Reuters) - Japan's Nikkei share average fell on Tuesday, snapping a five-day winning streak as renewed worries about the euro zone crisis triggered profit-taking from recent gains, with the benchmark pulling away from a 33-month high hit the previous day. The Nikkei dropped 1.9 percent to 11,046.92, moving away from a 33-month closing high of 11,260.35 hit on Monday. The Nikkei's volume hit 3.85 billion shares, the highest level since March 2011. With the Nikkei adding 4 percent in the past five days, investors took renewed concerns about the euro zone debt crisis as a reason to lock in profits. In Europe, Spanish and Italian bond yields rose after a corruption scandal prompted calls for Spanish Prime Minister Mariano Rajoy to resign and on news of a probe of alleged misconduct involving an Italian bank three weeks before national elections. "The Nikkei is seen rising further in the longer term, but the market has been looking for a correction. In the short term, the Nikkei's resistance is seen around 11,300," said Tsutomu Yamada, a market analyst at Kabu.com Securities. Yamada added that if the Nikkei breaches this level, the highest since April 2010, it will likely enter the next stage to chase the market higher to 12,000. With Japanese corporate earnings in full swing, on Tuesday, investors carefully awaited bellwether earnings such as from Toyota Motor Corp after the market close. Toyota raised its annual net profit forecast by more than 10 percent to 860 billion yen ($9.3 billion) on strong sales of the Camry sedan and other vehicles in its biggest market the United States, as well as the yen's drop. Some companies disappointed the market, with Hitachi Ltd falling 6.4 percent as the industrial machinery firm sliced 13 percent off its full-year operating profit outlook, citing sluggish demand in Europe and a slowdown in emerging markets. But Panasonic Corp rose as much as 12 percent before closing up 3.9 percent as it extended gains from Monday, after reporting a third-quarter operating profit, turning around from a loss the previous year. "It looks like hot money as well as some short-covering. Its results were not particularly unexpected, but once the price started going up, a lot of retail investors piled in," said Masato Futoi, head of cash equity trading at Tokai Tokyo Securities. Japan Airlines Co Ltd was also in favour, ending up 5.1 percent after rising as much as 7.6 percent to its highest level since its public offering last September, as the airline hiked its operating profit forecast by 12.7 percent to 186 billion yen ($2 billion) for the year to March 31. The airline estimated the impact on its earnings from the grounding of Boeing's Dreamliner jet at around 700 million yen ($7.6 million) for the rest of this fiscal year, but said it will discuss compensation with Boeing.
RECENT GAINERS LOSE GROUND Some of the most sluggish stocks on Tuesday were those that had gained sharply over the past 2-1/2 months on hopes that Prime Minister Shinzo Abe's brand of aggressive monetary and fiscal policy would reinvigorate the economy. The real estate sector, which has soared around 27 percent since mid-November, sagged 5.3 percent, while the insurers' sub-index, which has shot up 38 percent over the past 2-1/2 months, dropped 3.8 percent. "The market has been moving on expectation and speculation for months, but investors might start looking at the here-and-now soon," said Ryota Sakagami, chief strategist of equity research at SMBC Nikko Securities. "Companies that would benefit from a return to inflation - insurance, real estate and banks - might cool down because that hasn't actually happened yet, while the winners from a weaker yen will remain in focus because that's very real," he added. The yen moved further off a fresh 33-month low hit on Monday morning of 93.185 against the dollar, to 92.38 by Tuesday. The Japanese currency's 14 percent slide since mid-November has propelled up exporters, whose overseas revenues will be swollen Index heavyweight Fast Retailing Ltd, the operator of the Uniqlo clothing chain, fell 3.2 percent after its same-store sales fell 5.5 percent in January from a year earlier, citing fewer weekend days in the month. The broader Topix fell 1.7 percent to 939.70 in heavy trade, with 4.8 billion shares changing hands, the highest level since March 2011.