* Nikkei regains nearly all last week's losses, trade thin
* Broad-based buying on hopes of U.S., global recovery
* Lawson, Matsumotokiyoshi up on news of joint stores
* Election eyed, though opposition win largely factored in
By Elaine Lies
TOKYO, Aug 24 (Reuters) - Japan's Nikkei average surged more
than 3 percent on Monday, buoyed by hopes for a global economic
recovery that sent U.S. shares climbing, with Canon Inc <7751.T>
and other exporters leading the benchmark higher.
Convenience store operator Lawson Inc <2651.T> and drugstore
chain Matsumotokiyoshi Holdings Co Inc <3088.T> gained after
announcing they would jointly open stores combining their two
retail formats. []
The S&P 500 <.SPX> and the Nasdaq <> both hit 10-month
intraday highs, while the Dow <> rose to its highest level in
nine months on Friday after surprisingly good home sales data and
positive comments by Federal Reserve chief Ben Bernanke.
"Basically all of the gains are due to expectations of an
economic recovery -- first in the United States, then here in
Japan," said Yutaka Miura, a senior technical analyst at Mizuho
Securities.
The benchmark Nikkei <> gained 3.1 percent or 319.13
points to 10,557.33 in thinnish trade after losing 3.4 percent
last week.
The broader Topix <> rose 2.5 percent to 970.84.
Analysts said there was little apparent impact at this point
from the approaching Aug. 30 general election for the Japanese
parliament's lower house but that some wariness ahead of the
results could keep the Nikkei from surging much beyond the
10-month high of 10,630.38 hit on Aug. 14, at least on Monday.
Public opinion polls show the opposition Democratic Party is
likely to trounce the conservative Liberal Democratic Party that
has ruled for most of the past half-century, with some saying it
could win 300 seats in the 480-seat chamber, and most market
analysts saying the result is mainly factored in. []
"I would say that most of the market expects an opposition
victory, the question is by how much. Too large a victory -- say
well over 300 seats -- might make some investors nervous," said
Takashi Ushio, head of the investment strategy division at
Marusan Securities.
"That's because some of the policies in the Democratic
platform, such as pledging sharp cuts in greenhouse gases and
ending hiring of temporary workers raise fears of damage to
Japanese competitiveness and can't necessarily be said to be good
for business."
But others said a win itself was less of an issue for the
market than what sort of policies the untested opposition would
put in place afterwards.
EXPORTERS, OIL
Matsumotokiyoshi ended the morning up 3.9 percent at 2,390
yen after opening up more than 7 percent, while Lawson climbed
1.7 percent to 4,100 yen.
Their alliance follows deregulation earlier this year that
paved the way for convenience stores and other retailers to sell
many over-the-counter medicines without needing a licensed
pharmacist on the premises. []
Exporters were some of the biggest winners after a surprising
7.2 percent jump in July sales of previously owned U.S. homes
gave U.S. shares a boost.
That was enhanced by comments by Bernanke, who said economic
activity in the U.S. and abroad appears to be levelling out but
also warned that growth would be sluggish. []
Canon, the world's largest digital camera maker, shot up 5.7
percent to 3,700 yen and chip-tester maker Advantest Corp
<6857.T> surged 6 percent to 2,395 yen.
Toyota Motor Corp <7203.T> climbed 3 percent to 4,100 yen,
while Honda Motor Co <7267.T> advanced 3.2 percent to 3,050 yen.
The Nikkei business daily reported on Saturday that Honda
plans to develop an electric car to debut in the U.S. market by
around 2015 as tighter environmental regulations push demand for
zero-emission vehicles. []
Some analysts said carmakers were also getting a boost from
short-covering after being beaten sharply lower in Friday trade,
when they led the market lower.
Oil and gas field developer Inpex <1605.T> and other
energy-linked shares gained as oil prices steadied at around $74
a barrel on Monday, keeping last week's gains of nearly 10
percent on optimism about a U.S. economic recovery. []
Inpex jumped 4.7 percent to 753,000 yen, while Nippon Mining
Holdings <5016.T> climbed 2.7 percent to 492 yen and Nippon Oil
<5001.T> advanced 2.5 percent to 543 yen.
Trading houses also gained as they are major dealers in
energy and have stakes in oil and gas projects.
Mitsubishi Corp <8058.T> gained 3.7 percent to 1,912 yen and
Mitsui & Co <8031.T> rose 3 percent to 1,262 yen.
Trade fell off, with 885 million shares changing hands on the
Tokyo exchange's first section compared with last week's morning
average of 972 million.
Advancing shares outpaced declining ones by more than 21 to
1.
(Editing by Michael Watson)
