Nikkei up 0.7 pct, trading houses lifted by oil

                                
 (Adds stocks and comments)
                                
 By Taiga Uranaka
                                
 TOKYO, April 23 (Reuters) - Japan's Nikkei average rose 0.7
percent on Wednesday, lifted by trading houses like Mitsubishi
Corp <8058.T> and Mitsui & Co <8031.T> on record high oil
prices.
                                
 Exporters like Toyota Motor Co <7203.T> fell as a stronger
yen and overnight losses on Wall Street prompted investors to
lock in recent gains ahead of Japanese corporate earning
season.
                                
 "Money has been flowing to beneficiaries of high oil prices
such as trading houses and other resources shares, but
investors are concerned about exporters ahead of earnings,"
said Noritsugu Hirakawa, strategist at Okasan Securities.
                                
  U.S. crude oil futures jumped to a record near $120 on
Tuesday as a weak dollar encouraged buying of commodities and
as developments in Nigeria and the U.K. stoked supply concerns.
[ID:nN22456547]
                                
 Trading houses, which have stakes in overseas oil fields
and coal mines, rose, with Mitsubishi up 3.4 percent at 3,610
and Mitsui climbing 4.5 percent to 2,570 yen.
                                
  Oil and gas field developer Inpex Holdings Inc <1605.T>
rose 3.3 percent to 1.26 million yen.
                                
 Inpex and trading house Itochu Corp <8001.T> said on
Tuesday that a BP-led <BP.L> consortium including the two
companies had started oil production at the Gunashli field in
the Caspian Sea in Azerbaijan [ID:nT311994].
                                
 Itochu rose 3 percent to 1,157 yen.
                                
 On the flip side, exporters fell on mounting concerns that
soaring oil prices would further hurt weak consumer spending in
the U.S.
                                
 Toyota lost 0.6 percent to 5,200 yen and Honda Motor Co Ltd
<7267.T> slid 0.3 percent to 3,230 yen, though they regained
some ground by midday.
                                
 "Recent gains came as credit fears had receded, but worries
are coming back to the surface with surging oil prices and the
weaker dollar," said Masashi Wakabayashi, general manager of
the trading department at Meiji Dresdner Asset Management.
                                
  The Nikkei <.N225> ended the morning up 92.83 points at
13,640.65, while the broader TOPIX index <.TOPX> gained 0.8
percent to 1,322.26.
                                
 CHUGAI FLIES
                                
 Chugai Pharmaceutical Co Ltd <4519.T> surged 10.1 percent
to 1,378 percent, becoming the biggest percentage gainer on the
Nikkei, after it lifted this year's profit outlook, saying
government drug price cuts were not as bad as feared, though
its first-quarter income halved on weak Tamiflu sales.
[IDn:T297056]
                                
 Japan's largest brokerage, Nomura Holdings Inc <8604.T>,
extended its losses, falling 1.8 percent to 1,610 yen. The firm
said on Tuesday that it had fired an employee at the centre of
an insider trading ring and warned the fallout could harm its
business. [ID:nT306300]
                                
 The insider trading scandal, the broker's second in five
years, comes on top of falling profits and $1.4 billion in
subprime losses, after which the firm replaced its CEO.
                                
 Harushige Kobayashi, head of the research department at
Maruwa Securities, said the scandal was likely to affect
Nomura's business as some of its client companies are expected
to suspend deals with the firm.
                                
 Trade picked up, with some 804 million shares trade
compared with last week's morning average of 770 million.
                                
 Advancers outnumbered decliners by 946 to 572.
 (Editing by Michael Urquhart)