* Nikkei up 1.3 pct, after a 2.7 pct rally the previous day
* Nissan jumps on news of smaller output cuts, yen helps
* Advantest slumps after a record annual loss warning
(Adds stocks, details)
By Aiko Hayashi
TOKYO, Feb 26 (Reuters) - Japan's Nikkei average rose 1.3
percent on Thursday as Nissan Motor <7201.T> jumped on news that
it plans smaller output cuts, helping ease market fears about
slumping demand, while a weaker yen helped other exporters.
But Advantest Corp <6857.T> tumbled after the company warned
it faces a record $804 million annual loss, while drugmaker
Daiichi Sankyo <4568.T> dropped after U.S. regulators said Indian
generic drugmaker Ranbaxy Laboratories <RANB.BO>, in which
Daiichi holds a controlling stake, had falsified data.
"The market continues on a recovery track after U.S. trade
was relatively calm. There's also the softer yen," said Kazuhiro
Takahashi, general manager at Daiwa Securities SMBC.
"News about Nissan's smaller production cuts also indicates
that we may be getting out of a state of crisis, though a lot
will still depend on economic stimulus measures by the U.S.
government."
On the policy front, a newspaper reported that the Japanese
government is considering asking the central bank to buy stock
exchange-traded funds (ETFs) to prop up Japanese share prices.
[]
"News like this may help stop a further tumble in the market
but it is not something that will push it up," said Masayoshi
Okamoto, head of dealing at Jujiya Securities.
The benchmark Nikkei <> ended the morning up 99.09
points at 7,560.31, after ending the previous day up 2.7 percent.
On Tuesday, it fell as low as 7,155.16 -- within sight of a
26-year low just under 7,000.
The broader Topix <> gained 0.6 percent to 750.29, after
earlier in the week hitting its lowest close since December 1983.
The Dow Jones industrial average <> shed 1.1 percent on
Wednesday as homebuilders and big manufacturers fell after data
showing sales of previously owned U.S. homes plunged much more
than expected in January. []
NISSAN JUMPS, ADVANTEST TUMBLES
Nissan climbed 3.3 percent to 310 yen after Japan's
third-largest carmaker said it plans to reverse some of its
production cuts at Japanese plants in March after earlier output
cuts helped to reduce inventory.
Automakers are now starting to restore some production as
inventories stabilise with Toyota Motor Corp <7203.T>, the
world's biggest automaker, planning to raise output slightly in
May. []
Honda Motor Co <7267.T> leapt 3.3 percent to 2,475 yen, but
Toyota dipped 0.6 percent to 3,200 yen.
Other exporters initially advanced on help from a weaker yen,
though many gradually lost steam by the end of morning trade.
The dollar rose as high as 97.88 yen <JPY=> on trading
platform EBS, its highest since mid-November and up 0.5 percent
on the day. Investors usually welcome a softer yen as it boosts
exporters' profits when repatriated.
TDK Corp <6762.T> added 1.2 percent to 3,340 yen, though
Canon Inc <7751.T> turned into negative territory to fall 0.4
percent to 2,495 yen.
Among decliners, Advantest plunged 8.6 percent to 1,303 yen
after the world's biggest supplier of machines that test
semiconductors said it would cut more than a quarter of its
workforce and warned it faces a record $804 million annual loss.
[]
Drugmaker Daiichi Sankyo dropped 5.5 percent to 1,754 yen
after U.S. regulators said there was evidence that a plant owned
by Ranbaxy had falsified data and test results submitted in
approved and pending drug applications. []
The two stocks were the top drags on the Nikkei 225.
Trade was active on the Tokyo exchange's first section, with
943 million shares changing hands, compared with last week's
morning average of 819 million.
Advancing stocks outnumbered declining ones, 796 to 729.
(Editing by Chris Gallagher)
