*Nikkei rises 1.1 percent, after losing 2 percent on Thursday
*Financial shares gain after news of Lehman sale talks
*Property firms, trading houses rise after recent sell-off
(Adds stocks, details)
By Aiko Hayashi
TOKYO, Sept 12 (Reuters) - The Nikkei average rose 1.1
percent on Friday, buoyed by financial shares, with investors
cheering news that U.S. investment bank Lehman Brothers <LEH.N>
was in talks about a possible sale.
Improving investor confidence helped lift the overall market,
including recently battered shares of trading houses and property
firms such as Mitsui Fudosan Co <8801.T>.
Lehman and U.S. regulators were in intensive discussions
about a number of options, including a complete sale, but the
firm was resisting government intervention, a source with direct
knowledge of the talks said. []
"That is positive because that means the number of ailing
entities will decrease through an industry realignment," said
Masaru Hamasaki, senior strategist at Toyota Asset Management.
"But selling pressure awaits after short-covering because
investors have become risk-averse on worries about the economy
and corporate earnings."
The benchmark Nikkei average <> added 128.49 points to
finish the morning session at 12,230.99, after losing 2 percent
the previous day.
The broader Topix <> also gained 1.1 percent to
1,175.16.
Bank of America Corp <BAC.N> or Barclays <BARC.L> could be
suitors for Lehman, according to various reports. Bank of
America, Barclays and Lehman have declined to comment.
But even if problems at Lehman are worked out, worries about
the U.S. financial sector will likely continue to haunt the
market, market players said.
"There could be a second and a third Lehman. Overall
sentiment isn't improving drastically," said Kazuki Miyazawa,
market analyst at Daiwa Securities SMBC.
BANKS GAIN GROUND
Mitsubishi UFJ Financial Group <8306.T>, Japan's top bank,
gained 3.3 percent to 850 yen, while No.2 Mizuho Financial Group
<8411.T> jumped 4.3 percent to 464,000 yen and Sumitomo Mitsui
Financial Group <8316.T>, the third-biggest bank, added 4.3
percent to 678,000 yen.
Shares of Mitsui Fudosan climbed 4 percent to 2,340 yen and
Sumitomo Realty & Development <8830.T> advanced 4.2 percent to
2,470 yen.
Trading firm Mitsui & Co <8031.T> shot up 6.5 percent to
1,632 yen and Mitsubishi Corp <8058.T> rose 2.8 percent to 2,595
yen.
Shares of Noritz Corp <5943.T> surged 8.2 percent to 1,052
yen, after U.S. hedge fund Steel Partners offered to buy out the
gas and water heater maker for 42.3 billion yen, its latest bid
to squeeze higher returns out of its investments in Japan.
[]
SBI Holdings Inc <8473.T> climbed 4.6 percent to 18,830 yen,
after its subsidiary SBI Biotech sold development and marketing
rights for an protein that may be used to treat autoimmune
diseases like lupus to AstraZeneca's <AZN.L> biotech unit
MedImmune.
Trade volume jumped on the Tokyo exchange's first section, as
is typical for days when the settlement price is determined for
index futures and options.
Some 1.46 billion shares changed hands in morning trade,
compared with last week's morning average of 859 million.
Nikkei futures and options contracts expiring in September
likely settled at 12,295.55, Tokyo market participants said,
citing estimates by local brokerages. []
Advancing stocks outpaced declining ones by nearly 3 to 1.
(Reporting by Aiko Hayashi; Editing by Edwina Gibbs)
