Nikkei ekes out modest gains, lifted by Asian shares

The Nikkei average scored modest gains on Wednesday, bolstered by short-covering ahead of the U.S. Federal Reserve's policy decision and as a rise in Asian shares eased worries about the fallout from Europe's debt crisis on the global economy.
But thin trade volume indicated a lack of strong investor interest, with many deeply worried over how Europe could defend itself from a deepening debt crisis.
The Nikkei rose 0.4% to 8,754.53. The broader Topix index climbed 0.4% to 758.13.
A rise in Asian share prices, including a sharp rebound in Shanghai stocks from a 14-month low hit on Tuesday, helped to lift Tokyo shares.
Some market players were cutting back short positions in case the Fed may take bolder steps than expected.
"It's customary for traders to close out their positions before an event. And it's not hard to imagine that many had taken short positions," said Hideyuki Ishiguro, assistant manager of investment strategy at Okasan Securities.
Also soothing investors' nerves was Greece's promise to cut its public sector further before a second conference call with international lenders, whom Athens must persuade to extend more loans to avoid bankruptcy next month.
Still, worries about the European debt and banking crisis has hardly abated, with many investors now thinking a debt default by Greece is inevitable.
"The market will be glued to Europe. The question is whether Europe is going to have a safety net ready for banks. If Spanish and Italian bonds fall further, banks could suffer massive losses," Ishiguro said.