* Nikkei climbs 0.9 pct
* Yen hits 7-mth low vs dollar on expectations of LDP
* Profit-taking in non-exporters started - analyst
* Real estate sector down on profit-taking
* Softbank gains after J.P. Morgan lifts price target
By Ayai Tomisawa
TOKYO, Nov 21 (Reuters) - The Nikkei average climbed to a
two-month high on Wednesday, with exporters gaining after the
yen hit a seven-month low against the dollar on expectations
that a new government will aggressively push the Bank of Japan
to expand monetary stimulus.
Among exporters, the transport equipment sector was a
notable gainer as foreigners bought carmakers such as Toyota
Motor Corp and Honda Motor Co, which advanced
2.2 percent and 3.2 percent respectively.
Shinzo Abe, leader of the main opposition Liberal Democratic
Party (LDP), has called for more extreme measures from the
central bank, including setting a 3 percent inflation target to
pull the export-reliant economy out of deflation.
His comments ahead of a Dec. 16 national election have
whipsawed the yen, which hit a seven-month low of 81.975
yen to the dollar on Wednesday. A softer Japanese currency
inflates exporters' overseas earnings when repatriated and
increases their sales competitiveness.
The Nikkei climbed 0.9 percent to end at a two-month
high of 9,222.52, with a resistance level seen at a September
high of 9,288. The broader Topix advanced 0.7 percent to
Analysts said that sector-rotation may be seen during the
next few days amid rapid rises in the Nikkei as some investors
want to reshuffle their portfolios while securing profits on
"Some investors are alarmed by the market's fast-paced
rises, and profit-taking is already seen in non-exporter
sectors," said Yoshiyuki Kondo, an analyst at Daiwa Securities,
adding that a further correction of about 200 points is possible
in the Nikkei as the index has added about 500 points in the
The property sector was heavily hit, with the Topix real
estate index falling 1.6 percent to post the biggest
drop on the board. Mitsui Fudosan dropped 2.3 percent
to 1,737 yen and Mitsubishi Estate shed 1.4 percent to
"The sector had been up on a recovery in building vacancy
rates and hopes for monetary easing, but it has become a target
of profit-taking because it is little-affected by daily
dollar-yen moves," Kondo said.
The real estate sector has added 5.7 percent over the past
week, and gained 47 percent this year.
TOYOTA, SOFTBANK IN DEMAND
Toyota was the second-most traded stock on the main board by
turnover, with Softbank Corp the most traded. Honda and
Canon Inc were the fourth and fifth-most traded,
Index heavyweight Softbank rose 3.0 percent to 3,005 yen
after J.P. Morgan raised its price target on the mobile operator
by 8.6 percent to 3,800 yen.
"The Japanese stock market is completely dependent on the
Japanese yen...so it's very simple. Maybe foreign investors will
rush into the Japanese stock market," said Yasuo Sakuma,
portfolio manager at Bayview Asset Management.
"If you look at the trading volume last Friday and the last
couple of days, not only short-covering but also the long-only,
new money is entering the Japanese stock market."
Sakuma said he was tilting his portfolio towards exporters,
such as auto parts makers, and camera and electronic device
makers and cutting his exposure to domestically-focused
companies such as retailers.
The benchmark Nikkei is up 9.1 percent this year, boosted by
the 5.7 percent rally from Nov. 14 to 19. Still, the Japanese
index lags a 10.4 percent rise in the U.S. S&P 500 and a
10.2 percent gain in the pan-European STOXX Europe 600.