TOKYO (Reuters) - The Nikkei average edged up 0.1 percent on Friday, helped by drugmaker Daiichi Sankyo Co <4568.T> after European regulators backed a key product, but trade was cautious ahead of a decision on interest rates by the Bank of Japan.
Toyota Motor Corp <7203.T> edged up even after the NIKKEI (NIKKEI225.)financial daily said the automaker was likely to report its first-ever operating loss in the year ending March 31 due to plunging sales and the strength of the yen.
"The number of participants is limited, making the market volatile, as investors want to see if the BOJ will cut interest rates, coupled with a lack of trading factors and the holiday season," said Takahiko Murai, general manager of equities at Nozomi Securities.
"The moving range for the index will likely be limited unless currencies start moving drastically or some big news emerges from the United States."
The Fed's dramatic rate cut has raised the pressure on a reluctant BOJ to follow suit at its two-day policy review ending on Friday. U.S. interest rates are now below Japanese rates for the first time since February 1993.
The benchmark Nikkei <.N225> added 12.54 points to 8,679.77 after opening down 0.3 percent.
The broader Topix <.TOPX> gained 0.4 percent to 841.70.
Shares of Daiichi Sankyo jumped 4.9 percent to 2,005 yen after a new blood clot preventer prasugrel, developed by the Japan's No. 3 drugmaker and Eli Lilly & Co, won a major endorsement from international regulators on Thursday when the European Medicines Agency recommended its approval.
Toyota Motor Corp <7203.T> inched up 0.5 percent to 2,975 yen.
"Toyota shares had already been sold off, but the market will likely start pricing in a possibility that next year will be even worse, preventing the stock price from going above 3,000 yen in the short-term," said Murai at Nozomi Securities.
(Reporting by Aiko Hayashi; Editing by Chris Gallagher)
