TOKYO -- Thank god for bargain-hunters who think a stock worth $1,250 a pop is cheap.

Tokyo shares edged higher thanks to retail buying in

Softbank

, which jumped late in the day to erase its 15% loss from Monday. Despite Softbank holding up, other large tech plays were weaker, as investors unwound cross-shareholdings before the March 31 fiscal year-end.

The key

Nikkei 225

index rose 147.89 to 19,944, while the

Topix

index, which includes shares listed on the

Tokyo Stock Exchange's

first section, climbed 15.70, or 1.0%, to 1665.53. The

Jasdaq

small-cap index fell 1.82, or 1.6%, to 110.14, while the Nikkei

over-the-counter

shares slid 59.02, or 2.5%, to 2324.71.

Although market watchers expect the Nikkei index to fall further ahead of the fiscal 1999 year-end, yesterday's selloff in many U.S. equities has some on the edge of their seats.

"The recent selling in tech, electronic and telecom shares is definitely due to large Japanese investors unwinding cross-shareholdings. Having said that, U.S. investors are also selling amid the fray, which gets me a bit worried as to why," said a head of an equities trading desk at a U.S. firm here who asked not to be named.

"Sure, losses on

U.S. Treasuries a few months back only explains half the story. There could be many more short-term

hedge funds who are getting hit elsewhere and are covering losses in Japanese stocks," he added.

After sliding yesterday due to a ratings downgrade by

Nikko Salomon Smith Barney

, Softbank gained 18,000 yen, or 15.4%, to 135,000. Nikko Salomon said it had cut Softbank's rating to neutral from outperform over concerns about the firm's bid for now-nationalized

Nippon Credit Bank

.

Hitachi

(HIT)

rose 19, or 1.4%, to 1420.

Nippon Telegraph & Telephone

(NTT)

lost 20,000, or 1.3%, to 1.51 million, while

Yahoo! Japan

shed 7 million, or 5.0%, to 133 million.

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Sony

(SNE) - Get Report

, which was down 510, or 1.7%, to 29,040, said its

Sony Computer Entertainment

has sold 980,000 units of its new PlayStation2 game console, a wee bit shy of its 1 million-unit target. Of the sales, about 380,000 were ordered online, and analysts say this is the first time that shipments of a household appliance have topped 700,000 within the first few days of sale.

Mitsubishi Motors

rose 80, or 24.0%, to 413 after the

Nihon Keizai Shimbun

reported that

DaimlerChrysler

(DCX)

will take a 30% stake in the firm. The head of Mitsubishi Motors confirmed he did talk to DaimlerChrysler, but would not elaborate if the firm would take an equity stake. A key number to watch is whether Daimler will purchase a 33.4% stake, which gives them veto rights over the board and would signal a de facto buyout of Mitsubishi Motors.

The greenback inched slightly higher against the yen to 107.73 in slow trading.

Hong Kong's

Hang Seng

index rose 106.60 to 17,865.36. After the market talked up the possibility for

Legend's

(LGHLY)

possible inclusion in

Morgan Stanley Capital International's China Free

index and the Hang Seng, shares fell HK$5.75, or 9.2%, to 57.00 on profit-taking.

Many investors, likely following moves seen in the U.S., are actively seeking small-cap shares.

China Telecom

(CHL) - Get Report

shed 1.50, or 1.9%, to 77.50, while

Pacific Century CyberWorks

rose 0.75, or 3.2%, to 24.10.

Hong Kong also awaits the release of the fiscal budget Wednesday, and some traders said there could be damaging news for property, financial and retail shares if Hong Kong introduces a retail sales tax or increases the corporate tax rate.

With presidential elections coming up next week, Taiwan's

TWSE

index gained 12.16 to 9380.07 after much recent volatility. Korea's

Kospi

index lost 1.99 to 907.34