Nikkei gains after U.S. rate fears ease, Sony up

TOKYO, Apr 19 (Reuters) The Nikkei average rose 1.00 percent on Wednesday as Sony Corp and other exporters advanced after U.S. stocks posted their biggest gains in a year on expectations the U.S. interest rate-hike cycle may be near an end.

Fujitsu Ltd. climbed after revising up its earnings forecasts while Kyocera Corp and other makers of cellphone-related components rose after Texas Instruments Inc., the world's largest maker of wireless chips, posted a quarterly profit that topped Wall Street estimates.

The Nikkei was up 172.63 points at 17,405.49 as of 0453 GMT.

The broader TOPIX index rose 0.79 percent at 1,755.48.

The minutes of the U.S. Federal Reserve's latest meeting suggested that most participants saw the Fed's long tightening cycle coming to an end, and that some members were concerned about too much tightening.

Takahiko Murai, a general manager of equities at Nozomi Securities, said this may help keep not only U.S. but also Japanese long-term interest rates from rising further, making stocks attractive for investors.

''The yield curve has been steepening in Japan and that move may be halted, which should be positive for stocks,'' he said.

The yield on the Japanese 10-year government bond hit 2 percent on Tuesday for the first time since August 1999.

Masayoshi Okamoto, the head of dealing at Jujiya Securities, said the stock market will likely be swayed by the issue of interest rates going forward.

''Rises in interest rates will be a nagging issue. ... If investors link rises with the Japanese economic recovery, it will be a positive factor,'' he said.

Fujitsu gained 2.1 percent to 975 yen after it said it likely beat its net profit target for the year just ended by 36 percent, due to healthy sales of hard disk drives and mobile phones.

Other mobile phone-related firms gained ground on strong earnings from U.S. Texas Instruments Inc., with Kyocera adding 4.3 percent to 11,290 yen, and Murata Manufacturing Co. Ltd.

putting on 2 percent to 8,160 yen in Osaka.

Consumer electronics maker Sony rose 2.1 percent to 5,790 yen. Murai of Nozomi Securities said electronics companies are likely to show strong profit growth due to brisk sales of flat-screen televisions and other digital goods.

Elpida Memory Inc. surged 4.3 percent to 4,840 yen after the world's fifth-largest DRAM chip maker said its earnings on an operating basis looked brighter than it had previously expected for the year that ended in March.

Meanwhile, Aiful Corp. and other consumer loan companies fell after a government panel reviewing money-lending laws appeared to favour lowering the maximum interest rate allowed on consumer loans. Aiful slipped 3.9 percent to 6,710 yen.

REUTERS CS HS1105