Nikkei up 0.5 pc, exporters rebound on softer yen

Tokyo, Apr 20: The Nikkei rose 0.46 percent on Friday,recouping some of the previous session's losses that came amid an Asianequity sell-off, as Advantest Corp. and other exporters rebounded on aweaker yen and following calm trade in major overseas markets.

A string of positive media reports on earnings at major companiesincluding Canon Inc. and Toyota Motor Corp. also encouraged investorsto buy back recently battered high-tech and auto shares.

Tokyo Broadcasting System Inc. jumped by its daily price limit of13 percent at one point after Rakuten Inc. said it planned to buyadditional shares in the broadcaster.

Zenshiro Mizuno, senior managing director at Marusan SecuritiesCo. Ltd, said the market lacks solid buyers and is susceptible tospeculative moves.

''The problem is that we don't see substantial buying. That's whythe market easily swings and gets affected by the moves ofspeculators,'' he said. ''Besides, investors are in no rush to takerisks before corporate earnings are announced.'' The Nikkei closed up80.65 points at 17,452.62 after booking its biggest one-day fall in amonth the previous day.

The broad TOPIX index added 0.18 percent to 1,710.07.

Yoshinori Nagano, senior strategist at Daiwa Asset Management,said Japanese institutional investors are generally cautious aboutbuying shares, as they have not received much funds from retailinvestors to be allocated to Japanese shares since the new fiscal yearbegan this month.

''Japanese individuals have been putting more money intoinvestment trust funds, but their money is flowing into funds with afocus on foreign bonds and stocks, not on Japanese equities,'' he said.

Unless foreign investors show more buying interest in Japanese stocks, the upside of the Nikkei will be limited, he said.

Exporters Recover

Canon rose 0.8 percent to 6,560 yen, whileToyota added 1.2 percent to 7,380 yen. Both shares benefitted from theweaker yen, which boosts profits when earnings from abroad are broughthome.

The shares were also buoyed by media reports forecasting positive earnings results.

The Nikkei business daily reported on Friday that Canon is likelyto report a 14 percent increase in net income for 2007, while Toyota islikely to book an operating profit of 2.25 trillion yen ( billion)for the past business year, slightly above its estimate of 2.2 trillion.

KDDI Corp. became the largest contributor to the Nikkei's rise,climbing 1.8 percent to 976,000 yen after the Nikkei business dailyreported Japan's No. 2 phone operator will likely book an operatingprofit of about 350 billion yen for the year ended March 31, higherthan the company's recently revised estimate of 342 billion yen.

Among other notable gainers, TDK Corp. added 1.2 percent to 10,260 yen after U.S. recording disk and tape maker Imation Corp.

said on Thursday it would buy TDK's brand and sales operations in recording media for 0 million in stock and cash.

Goldman Sachs said in a report on Friday it raised the targetprice for TDK shares to 12,500 yen from 11,500 yen and retained thestock on its Conviction Buy List.

The brokerage said the sale of the media units would reduce TDK's sales but eliminate sales execution risk.

Nomura Holdings Inc., Japan's biggest investment bank, said onFriday it planned to launch a new Asia-focused investment business withthe creation of a principal finance team at its Hong Kong subsidiary.

Trade volume fell to its lowest in two weeks, with 1.79 billionshares changing hands, before major companies start posting theirearnings results next week for the year ended March 31 and projectingoutlooks for the new year.

''Views on corporate earnings are split and earnings from majorcorporations will start next week. This is very unusual,'' said KenichiHirano, operating officer at Tachibana Securities.

Declining shares beat advancers, 915 to 676.

Reuters