* Exporter earnings help buoy investor confidence
* Fed's upbeat view on economy positive for market -analysts
* Short-covering after Obama speech pushes market higher
By Elaine Lies
TOKYO, Jan 28 (Reuters) - Japan's Nikkei average rose 2
percent on Thursday, with upbeat reports on profits at Honda
Motor <7267.T> and Sony Corp <6758.T> adding to momentum from
strong earnings at other big name stocks such as Canon <7751.T>.
But Toyota Motor Corp <7203.T> slid on concerns about its
suspension of U.S. sales of key car models, while Hitachi
Construction <6305.T> tumbled over 6 percent after forecasting a
drop in annual profit. []
Short-covering emerged after President Barack Obama's State
of the Union address, partly on his pledge to revive the U.S.
economy and partly on relief that he had not been more negative
on big banks after a recent proposal for financial regulation
that sent global markets tumbling last week.
"He pledged to revive the economy and that of course is a
plus, but I think the bigger factor was simply relief that he
hadn't been tougher about the proposed bank regulation," said
Takashi Ushio, head of the investment strategy division at
Marusan Securities.
Market sentiment also gained support from the Federal
Reserve's more upbeat reading of the economy. Analysts said the
Nikkei was also ripe for a rebound after it shed more than 5
percent in a four-day losing streak to Wednesday.
The benchmark Nikkei <> gained 203.90 points to
10,455.98 by early afternoon after falling 0.7 percent the
previous day to its lowest close in five weeks.
The broader Topix <> added 1.4 percent to 920.10.
Canon rose 2.8 percent to 3,715 yen after forecasting its
first annual profit growth in three years after more than
doubling its profit last quarter, as the camera and office
equipment maker shifts gear back to expansion.
The world's largest digital camera maker said it expects
operating profit to jump 52 percent to 330 billion yen ($3.7
billion) in 2010, above the consensus for 319.8 billion yen in a
poll of 21 analysts by Thomson Reuters I/B/E/S. []
While Sony has been widely expected to post its first profit
in five quarters, the Nikkei business daily's estimate is higher
than the market consensus for an operating profit of 74.2 billion
yen. []
Sony jumped 6 percent to 3,115 yen.
Honda climbed 5.1 percent to 3,195 yen after the Nikkei
business daily said the automaker's operating profit for the
October-December quarter was likely in a range of 120-170 billion
yen ($1.3-1.9 billion), roughly twice that of the previous
quarter and above market expectations. []
"Investors are welcoming upward momentum in exporters'
profits on the back of a recovery in exports, a trend which has
finally become more apparent," said Tsuyoshi Segawa, an equity
strategist at Mizuho Securities.
"But caution will be necessary going forward as investor
focus will likely shift to improvements in earnings in absolute
terms."
(Additional reporting by Aiko Hayashi; Editing by Michael
Watson)
