Nikkei climbs on U.S. economy optimism after Fed

                                
 * Nikkei jumps on optimism for U.S. economy, short-covering
                                
 * JAL dives after news of potential split, public fund report
                                
 * Consumer lender Aiful plunges as warns of loss
                                
 * Tokyo market reopens after five-day weekend
                                
 By Elaine Lies
                                
 TOKYO, Sept 24 (Reuters) - Japan's Nikkei stock average
jumped 1.7 percent on Thursday, with exporters such as Honda
Motor Co <7267.T> rising after Federal Reserve statements that
U.S. economic activity was picking up outweighed fears about a
stimulus withdrawal by the Fed.
                                
 Active short-covering after the benchmark lost 0.7 percent
last week also boosted shares across the board, analysts said.
                                
 But Japan Airlines <9205.T> tumbled 11.1 percent after
sources said the company might be broken up and public
broadcaster NHK reported it is planning to seek a taxpayer-funded
bailout to overhaul its operations.
                                
 Consumer lender Aiful <8515.T> plunged 11.2 percent after it
said on Thursday it would halve its workforce and slash branch
numbers as it warned of a $3.4 billion loss for the year to March
2010. [ID:nT33949]
                                
 Though U.S. shares had originally risen sharply on Fed
comments that economic activity was picking up, they reversed
course in the last hour of trade on worries about the timing of
the removal of some of the Fed's stimulus.
                                
 But analysts said Tokyo was taking the more optimistic
stance.
                                
 "More than worries about the removal of any stimulus, I think
the market is really starting to get a sense that things are
improving -- this is why certain manufacturers that had fallen
behind a bit are strong today," said Nagayuki Yamagishi, a
strategist at Mitsubishi UFJ Securities.
                                
 "Basically, though, the Fed's comments do seem to be pointing
the way to the exit."
                                
 The Fed's policy-setters met and kept interest rates
unchanged, as expected, but they also said the U.S. central bank
would slow purchases of mortgage debt to extend the programme's
life until the end of March -- a move seen as a step towards a
measured withdrawal of its extraordinary support for the economy
during the downturn. [ID:nN23390829]
                                
 Yamagishi noted that while purchases of mortgage debt might
be slowing, they would still continue until March.
                                
 Other market players agreed the Fed statement was being taken
more positively than otherwise, with Wall Street's Wednesday fall
likely being little more than profit-taking.
                                
 "Wall Street had already factored in a lot of good economic
indicators over the past month, that's why the positive comments
didn't help," said Hiroaki Osakabe, a fund manager at Chibagin
Asset Management.
                                
 "What we saw yesterday was really just profit-taking."
                                
 The benchmark Nikkei <.N225> rose 177.88 points to 10,548.42,
while the broader Topix <.TOPX> rose 1.4 percent to 952.37.
                                
 With the Nikkei beginning trade on Thursday above a
short-term downtrend line, the technical picture is also becoming
somewhat brighter, Osakabe added.
                                
 The benchmark also broke well above its 25-day moving
average, which currently comes in around 10,400.
                                
 JAL, AIFUL TUMBLE
                                
 JAL fell to 152 yen. Earlier this week, two sources familiar
with the matter said lenders to JAL may seek to split the carrier
between its profitable and loss-making parts.[ID:nT38558]
                                
 Aiful, which last week asked creditors to let it to push back
repayments on $3 billion in debt, said it plans to cut about
2,000 jobs, or about 49 percent of the group's total workforce,
by February. [ID:nWNAB2629]
                                
 It tumbled to 119 yen.
                                
 But exporters fared better, rising on optimism about the U.S.
economic recovery.
                                
 Honda advanced 1.9 percent to 2,885 yen, while Kyocera Corp
<6971.T> climbed 3.3 percent to 8,350 yen and Tokyo Electron Ltd
<8035.T> jumped 4.8 percent to 5,850 yen.
                                
 Sony Corp <6758.T> gained 3.3 percent to 2,675 yen. A Sony
executive said on Wednesday that sales of the PlayStation 3 video
game console jumped in the weeks after a $100 price cut last
month, and strong demand could lead to empty shelves at
retailers. [ID:nN23396815]
                                
 Daiichi Sankyo <4568.T> climbed 1.7 percent to 1,912 yen
after its top executives on Wednesday predicted the company's
Benicar blood-pressure drugs would post modest sales gains even
after Merck & Co's rival Cozaar and Novartis AG's market-leading
Diovan begin facing generic competition. [ID:nN23422891]
                                
 Trade was moderate on the Tokyo exchange's first section,
with 1.1 billion shares changing hands, compared with last week's
morning average of 909 million.
                                
 Advancing stocks beat declining ones by nearly 4 to 1.
 (Reporting by Elaine Lies; Editing by Chris Gallagher)