U.S. Markets open in 2 hrs 5 mins

Nikkei extends fall into 4th day as U.S. standoff weighs

* Nikkei seen hovering near 14,000 amid U.S. uncertainty

* JAL bucks weakness after seeking revision on Haneda slots

By Ayai Tomisawa

TOKYO, Oct 7 (Reuters) - The Nikkei share average extended

losses into a fourth session on Monday after a weekend with

little progress in resolving the U.S. budget standoff left

investors frustrated, with U.S.-reliant exporters like Toyota

Motor coming under pressure.

The Nikkei was down 0.5 percent at 13,951.84 in midmorning

trade, after dropping 0.9 percent to a one-month closing low on


Republican House Speaker John Boehner vowed on Sunday that

there was "no way" Republican lawmakers would agree to a measure

to raise the debt ceiling unless it included conditions to rein

in deficit spending.

The comment raised fears that the U.S. Congress and

President Barack Obama could fail to reach a deal on raising the

ceiling by Oct. 17, when the Treasury has estimated it will have

run out of cash.

Among exporters with high exposure to the U.S. market,

Toyota Motor Corp fell 0.3 percent, Sony Corp

shed 0.5 percent and Subaru-maker Fuji Heavy Industries Ltd

dropped 1.6 percent.

But Japan Airlines Co rose 3 percent after the

airline on Friday asked the government to revise its decision to

allocate the majority of new international slots at Tokyo's

Haneda airport to rival ANA Holdings.

"Whether the government will revise this decision is

unknown, but JAL's action is creating hopes that it may," said a

fund manager at a Japanese asset management firm.

Market observers said Japanese stocks may stay sluggish for

the time being, with the Nikkei hovering around the 14,000-mark.

"It's scary to either buy or sell while the U.S. situation

could go either way," said Makoto Kikuchi, chief executive of

Myojo Asset Management. "But investors' patience may run out,

and such a mood may trigger a fall in the dollar against the yen

and selling in Japanese shares."

Japanese equity markets have been under pressure as the

deadline to raise the U.S. federal borrowing limit gets closer.

The Nikkei is down 5.8 percent from a two-month high hit in

September after the Federal Reserve surprised markets by

deciding not to start tapering its monetary stimulus just yet.

Some remain cautiously optimistic.

"I think those who wanted to take profits from the recent

rises are using this event as a reason to do so. If the market

is sold to a comfortable level, such dips will create bargain

hunting opportunities," said Toru Ibayashi, executive director

at UBS Securities.