*Nikkei up 0.5 percent after sliding 2 percent on Friday
*Investor confidence up on soft yen, less U.S. econ fears
*Honda, Advantest sold sharply after earnings
(Adds stocks, details)
By Aiko Hayashi
TOKYO, July 28 (Reuters) - The Nikkei average rose 0.5
percent on Monday as a softer yen and easing fears about the U.S.
economy helped boost investor confidence, sparking short-covering
in trading firms such as Mitsui & Co Ltd <8031.T>.
But investors dumped stocks with disappointing earnings such
as Honda Motor Co <7267.T>, which cut its annual profit and
global car sales forecasts, and Advantest Corp <6857.T>, which
tumbled to a quarterly loss on slumping sales and orders.
"Solid moves in U.S. stocks and a softer yen are supporting
the market, but investors are finding it difficult to buy due to
a large amount of uncertainty," said Yutaka Miura, deputy manager
of the equity information department at Shinko Securities.
"Investors are holding back as they are particularly keen to
see corporate results as Japan enters the earnings season, and
ahead of industrial output data and U.S. jobs data."
The benchmark Nikkei <> added 71.07 points to finish the
morning session at 13,405.83, after sliding 2 percent on Friday.
The broader Topix <> gained 0.5 percent to 1,304.66.
U.S. stocks rose on Friday as a drop in oil prices, and
stronger-than-expected data on consumer sentiment and housing
blunted the latest concerns about the health of U.S banks. []
Kenichi Hirano, operating officer at Tachibana Securities,
said investors will likely to continue to punish stocks with
disappointing results.
"It's natural to expect companies to report results that are
worse than expected, considering the current situation, and the
market has factored that in to some degree," he said.
"But it's still inevitable that investors move to sell stocks
when they see actual numbers."
Mitsubishi Electric Corp <6503.T> will report later in the
day. Other blue-chip companies including Sony Corp <6758.T> are
set to announce results later in the week.
HONDA, ADVANTEST SOLD
Shares of trading houses and property firms gained on
short-covering, and there was little new money flowing into the
sectors, market analysts said.
Trading firm Mitsui & Co jumped 4.5 percent to 2,205 yen and
Mitsubishi Corp <8058.T> climbed 2.9 percent to 3,150 yen.
Sumitomo Realty & Development Co Ltd <8830.T> gained 3.5
percent to 2,235 yen.
Some exporters rose as the dollar advanced against the yen,
with electronics maker Kyocera Corp <6971.T> adding 1.1 percent
to 9,400 yen, while TDK Corp <6762.T> rose 1.1 percent to 6,660
yen.
The dollar extended its gains to hit a one-month high above
108.00 yen <JPY=> on Monday. Investors welcome a weaker yen as it
inflates the value of overseas profits when they are brought back
home.
Honda and Advantest were the top drags on the Nikkei 225.
Honda shares skidded 3.5 percent to 3,630 yen after it
reported quarterly earnings on Friday. Its results beat market
estimates but it cut its annual profit and global car sales
forecasts as it battles with rising costs for raw materials and a
crumbling U.S. auto market. []
Advantest, the world's largest maker of chip testers, slid
6.1 percent to 2,170 yen after it tumbled to a quarterly loss as
sales were halved and orders fell to one-third of what they were
last year. It also forecast a first-half loss. []
Trade was light on the Tokyo exchange's first section, with
744 million shares changing hands, compared with last week's
morning average of 851 million.
Advancing stocks outpaced declining ones by 965 to 595.
(Reporting by Aiko Hayashi; Editing by Edwina Gibbs)
