Nikkei rises on lower oil prices, JAL higher

TOKYO, Aug 18 (Reuters) The Nikkei average rose 0.84 percent on Friday as Japan Airlines Corp gained on planned fuel surcharges while cheaper oil prices helped push up shares of rubber product manufacturers.

Falls in crude oil prices following a truce between Israel and Lebanese Hizbollah guerrillas also helped ease concern about a economic slowdown in United States, Japan's major trade partner, pushing up technology exporters Advantest Corp. and Kyocera Corp Retail investors' appetite for Japanese stocks is recovering as reflected in a strong performance by small-cap shares, Hiroichi Nishi, general manager of equity marketing at Nikko Cordial Securities Inc.

''The market is gathering momentum ... retail investors, many of them who lost a lot in the last market downturn, are getting ready to make money,'' he said.

The Nikkei was 133.81 points higher at 16,154.65 as of 0410 GMT. The broader TOPIX index was up 0.71 percent at 1,643.07.

Japan Airlines rose 3.2 percent to 224 yen after the country's biggest airline by revenue said it was seeking approval to increase fuel surcharges on its international flights.

All Nippon Airways Co. Ltd. rose 1.3 percent to 461 yen.

The rubber products sector fared well thanks to lower oil prices. Bridgestone Corp gained 2.4 percent to 2,375 yen.

In the technology sector, Advantest, the world's biggest chip-testing equipment maker, rose 2 percent to 11,340 yen, and electronics parts maker Kyocera gained 2 percent to 10,070 yen.

Alps Electric Co. Ltd. fell 2.9 percent to 1,354 yen after JP Morgan lowered its rating on the stock to ''underweight'' from ''neutral'', saying that hard disk drive (HDD) losses are likely to continue in and after the second half of fiscal 2006/07.

REUTERS CS DS1131