(Adds stocks, details)
By Aiko Hayashi
TOKYO, Jan 29 (Reuters) - Japanese stocks gained nearly 2
percent on Tuesday, with exporters such as Canon Inc <7751.T> in
favour due to a softer yen while banks gained after their U.S.
counterparts rose on hopes for another rate cut by the Federal
Reserve.
Shares of Victor Co of Japan (JVC) <6792.T> and Funai
Electric Co Ltd <6839.OS> jumped after an industry source said
the consumer electronics makers plan to form an alliance to
jointly develop and supply LCD television sets. []
"This is simply a rebound, though a softer yen is helping.
The Japanese market has recently been moving entirely in
response to external factors," said Masaru Hamasaki, a senior
strategist at Toyota Asset Management.
"The situation in America is likely to improve, helped by
stimulus measures for the economy. Even so, Japanese stocks are
unlikely advance on their own due to a cool investor attitude
toward the market."
A Fed policy meeting ends on Wednesday, with markets
expecting a further 50 basis point rate cut. The U.S. central
bank slashed its key rate by 0.75 percent to 3.5 percent in an
emergency step on Jan. 22 after recession fears prompted a
plunge in U.S. stocks.
The benchmark Nikkei average <> ended the morning
session up 1.8 percent or 241.16 points at 13,329.07 after
shedding 4 percent on Monday.
The broader TOPIX index <> added 1.9 percent or 24.65
points to 1,317.68.
The dollar hovered around 107.00 yen <JPY=> after rising to
107.14 yen in earlier trade.
All three major U.S. stock indexes gained more than 1
percent on Monday, with the Dow Jones industrial average <>
ending up 1.45 percent.
Hamasaki also said investors are closely watching President
George W. Bush's State of the Union address at 0200 GMT, but
they expect few surprises.
"In the long run, Americans can be confident about our
economic growth," Bush will say, according to excerpts of his
speech released in advance by the White House. []
EXPORTERS REBOUND
Shares of Japanese exporters drove higher as a weaker yen
boosts profits when earnings from abroad are brought home.
Canon rose 2.8 percent to 4,750 yen, Sony Corp <6758.T>
climbed 2.3 percent to 4,990 yen and Honda Motor Co Ltd <7267.T>
gained 2.6 percent to 3,220 yen.
Bank shares including industry leader Mitsubishi UFJ
Financial Group <8306.T> also climbed, tracking gains in U.S.
counterparts that rose after more weak housing data bolstered
expectations for a Fed rate cut.
Shares of Mitsubishi UFJ shot up 4.9 percent to 1,033 yen,
No.2 bank Mizuho Financial Group <8411.T> rose 3.9 percent to
508,000 yen and Sumitomo Mitsui Financial Group <8316.T>, the
third-biggest, added 3.6 percent to 828,000 yen.
Shares of JVC jumped 5.3 percent to 180 yen and Funai
Electric rose 5.9 percent to 4,110 yen.
Trade was light on the Tokyo exchange's first section, with
917.2 million shares changing hands, compared with last week's
morning average of 1.1 billion.
Advancing stocks outnumbered decliners by a ratio of more
than four to one.
(Reporting by Aiko Hayashi)
