*Weaker yen, lower oil help Nikkei extend gains
*Property shares up after brokerage "overweight" on top firms
*Chip-equipment makers lag, trading houses slip
(Adds stocks, details)
By Elaine Lies
TOKYO, July 23 (Reuters) - Japan's Nikkei stock average
climbed 1 percent on Wednesday, with Canon Inc <7751.T> and
fellow exporters leading it higher after the dollar gained
against the yen on oil's fall to a six-week low.
Mitsubishi Estate Co Ltd <8802.T> and Mitsui Fudosan Co Ltd
<8801.T> surged after JPMorgan initiated coverage of them with an
"overweight" rating, and other property firms rose in tandem.
Banks gained on relief that major U.S. bank results are now
over, with most performing better than expected.
But gains were limited by lingering worries about the U.S.
economy, with investors drawing back before Japanese earnings
results start moving into higher gear later this month.
"There's definitely a sense that the market has survived
potential problems, now that the U.S. bank earnings are behind
it, and this buoyed financials both on Wall Street and in Tokyo,"
said Yutaka Miura, senior technical analyst at Shinko Securities.
"But now Japanese results lie ahead, along with a sense that
not many good things can be expected from this, so the Nikkei is
unlikely to be pushed actively higher," he said.
Other market players said that while things may look good for
Wall Street at this point, much uncertainty still lies ahead.
"We're just seeing a temporary bright patch," said Yoku
Ihara, manager of the investment information department at Retela
Crea Securities. "It's still far too early to let down our
guard."
The benchmark Nikkei <> ended the morning up 133.69
points at 13,318.65, a day after rising 3 percent -- its biggest
one-day advance since May 29.
The broader Topix <> climbed 1.5 percent to 1,306.75.
PROPERTY POWERFUL
The real estate subindex <.IRLTY.T> surged 5.3 percent to
become the top performer among the subindexes after a recent
battering due to a number of factors, including worries after the
failure of midsize developer Zephyr Co <8882.T>.
JPMorgan said Mitsui Fudosan and Mitsubishi Estate had shown
stable earnings growth even amid an economic slowdown, sending
Mitsui Fudosan up 4.9 percent to 2,450 yen.
"The stock now trades at a substantial discount, primarily
due to excessive concerns regarding real estate prices," JPMorgan
analyst Hirokazu Anai wrote in a note.
"We see considerable upside potential for the shares as the
market recognises the company's stable earnings," he said.
Mitsubishi Estate climbed 6 percent to 2,545 yen to become
one of the top contributors to the Nikkei 225. Sumitomo Realty &
Development Co Ltd <8830.T> rose 6.1 percent to 2,255 yen.
Oil fell to its lowest level since early June on Tuesday amid
concerns about falling U.S. demand and expectations that a
hurricane in the Gulf of Mexico would spare most oil operations
[], and while this helped boost much of the market energy
shares were predictably battered.
Oil and gas field developer Inpex Holdings Inc <1605.T> shed
4.2 percent to 1.11 million yen, becoming one of the larger drags
on the Nikkei, while trading houses suffered as well.
Itochu Corp <8001.T> trimmed some of the sharp gains made on
Tuesday to sink 1.6 percent to 1,058 yen, while Marubeni Corp
<8002.T> was down 0.9 percent at 776 yen.
Chip equipment makers extended Tuesday's losses to become the
largest drag on the Nikkei, with Tokyo Electron Ltd <8035.T> down
3.2 percent at 5,990 yen and Advantest Corp <6857.T> sliding 2.6
percent to 2,265 yen.
But firmer banks kept the overall average bolstered, with
Mizuho Financial Group <8411.T> up 3.6 percent at 579,000 yen and
Sumitomo Mitsui Financial Group <8316.T> up 3.2 percent at
877,000 yen. Mitsubishi UFJ Financial Group <8306.T> rose 2.7
percent to 1,013 yen.
Canon gained 1.4 percent to 5,220 yen and Honda Motor Co
<7267.T> rose 3.3 percent to 3,720 yen. Industrial robot maker
Fanuc Ltd <6954.T> rose 3.4 percent to 9,990 yen.
Trade picked up, with 949 million shares changing hands,
compared with last week's morning average of 858 million.
Advancing shares beat declining ones by more than four to one.
(Reporting by Elaine Lies; Editing by Chris Gallagher)
