(Updates to midday)
By Aiko Hayashi
TOKYO, May 7 (Reuters) - Japan's Nikkei stock average rose
0.9 percent on Wednesday to its highest in nearly four months as
easing concerns about the credit crisis boosted financial shares
such as Mitsubishi UFJ Financial Group <8306.T>, while high-tech
exporters and automakers climbed on a softer yen.
Resource-related shares such as Inpex Holdings <1605.T> and
trading houses jumped after oil shot to a record above $122 a
barrel on Tuesday. []
Japanese markets were closed on Monday and Tuesday for
national holidays.
"Foreign money is flowing into Japanese stocks such as banks,
securities, real estate and commodity-related firms, on receding
credit fears and the solid New York market," said Akihito
Yamanoi, general manager of the equity investment department at
AIG Global Investment Corp (Japan).
"Worries about the economic outlook still remain, but for
now, risk money that was taken off the table due to overly
pessimistic sentiment is partly returning to the market."
The benchmark Nikkei average <> ended the morning
session up 130.23 points at 14,179.49, hitting its highest level
since Jan. 15.
The broader TOPIX index <> gained 1.6 percent or 21.50
points to 1,398.89.
The Nikkei had logged its highest close since Jan. 11 on
Friday. It rose 1.3 percent last week to post its seventh weekly
gain this year.
"Credit fears are drastically receding due to the boosting of
capital by financial firms," said Takahiko Murai, general manager
of equities at Nozomi Securities.
"Investors have become too optimistic, though, as they seem
to be finding positives in the economy and corporate earnings
that have actually been steadily deteriorating."
The dollar climbed 0.2 percent to 104.95 yen <JPY=>, helping
exporters. Toyota Motor <7203.T> advanced 2.6 percent to 5,570
yen.
BANKS, RESOURCE STOCKS FAVOURED
U.S. stocks rose on Tuesday as financial shares were buoyed
by reassuring comments about the credit and housing markets from
Fannie Mae <FNM.N>, the largest U.S. provider of home financing.
Japan's banks gained, with top lender Mitsubishi UFJ up 3.4
percent at 1,169 yen. No.2 Mizuho Financial Group <8411.T> jumped
4.3 percent to 562,000 yen and Sumitomo Mitsui Financial Group
<8316.T>, the third-biggest bank, rose 1.5 percent to 925,000
yen.
Nomura Holdings Inc <8604.T>, Japan's largest brokerage,
climbed 3.3 percent to 1,896 yen.
Technology shares rose, with Canon Inc <7751.T> gaining 1.7
percent to 5,490 yen and Japanese electronic components maker TDK
Corp <6762.T> advancing 2.3 percent to 7,230 yen.
Market analysts said Cisco Systems Inc's <CSCO.O> results
also improved investor confidence in technology shares.
Cisco reported stronger-than-expected quarterly profits on
Tuesday as rising Internet traffic fuelled sales of its network
equipment, despite concerns about a slowing U.S. economy.
[]
Among resource-related shares, Japan's top oil and gas
developer Inpex Holdings surged 10.6 percent to 1.25 million yen,
while trading house Mitsubishi Corp <8058.T> shot up 5.5 percent
to 3,460 yen.
Japanese telecoms and Internet group Softbank Corp <9984.T>,
which owns a 3.9 percent stake in Yahoo Inc <YHOO.O>, was flat at
2,130 yen after Microsoft Corp <MSFT.O> withdrew a $47.5 billion
offer for Yahoo. []
Trade picked up on the Tokyo exchange's first section, with
966 million shares changing hands, compared with last week's
morning average of 842 million.
Advancing stocks beat decliners by more than 3 to 1.
(Reporting by Aiko Hayashi)
