* Nikkei up 2.03 pct, Topix gains 1.8 pct
* Exporters, financials log gains
* Fed's improved U.S. outlook, retail data buoy Nikkei
* Gree tops turnover list, sinks on broker downgrade
By Mari Saito
TOKYO, March 14 (Reuters) - Japan's Nikkei share
average climbed to a seven-month high on Wednesday, boosted by
Wall Street gains after the Federal Reserve upgraded its U.S.
economic outlook, while Tokyo blue chips received a further lift
from the softer yen.
Exporters and financials outperformed, with Sony Corp
jumping 5.4 percent, Nissan Motor Co Ltd up
4.5 percent and Japan's leading investment bank Nomura Holdings
Inc gaining 3.4 percent.
"It's only now that we begin to see foreign, real buying
become more visible," said Stefan Worrall, director of equity
cash sales at Credit Suisse in Tokyo, adding that core 30 buy
orders and buying across the spectrum had increased.
The benchmark Nikkei gained 200.89 points to
10,099.97, climbing above 10,000 points for a fourth straight
session to the highest level since late July.
Market participants said a real test of investor confidence
would be whether the index could end the day above 10,000
points. The index has breached the level in three previous
sessions, but has so far failed to finish above the mark.
"There's a lot of money sitting on the sidelines that hasn't
benefited from the rally from beginning of the year, who are
finding themselves flatfooted. There will be further upside in
the Nikkei rally if we see real money continue to come in," said
The broader Topix was up 1.8 percent at 860.66.
Trading volume on the Nikkei was at 70.9 percent
of its average daily 90-day volume.
"People are picking up high-beta stocks now as the feeling
is that Japan's market is still lagging global markets -- plus
the weaker yen -- are providing a boost," said Yasuo Sakuma,
portfolio manager at Bayview Asset Management.
In terms of valuations, the Topix carried
a 12-month forward price-to-book ratio of 0.97, lower than S&P
500's 1.96 and STOXX Europe 600's 1.37.
Additionally, the dollar hit an 11-month high of 83.18 yen
during early Asian trade, lifting investor appetites
Bucking the market trend was Gree Inc, which topped
the turnover list and shed 5.8 percent after Daiwa Capital
Markets downgraded the social gaming company to neutral from buy
and cut its six-month target price to 2,600 yen from 3,200.
Also heavily traded were Japanese megabanks Mizuho Financial
Group Inc, Mitsubishi UFJ Financial Group Inc
and Sumitomo Mitsui Financial Group Inc, up between 1.5
and 2.8 percent.
Japan's financials gained after their U.S. counterparts led
Wall Street to its best performance this year, buoyed also by
Fed stress test results that gave high marks to most of the
The stress test results by the central bank came on the
heels of an earlier announcement that the U.S. economy was
"expanding moderately" although growth still faced significant
Tuesday marked the first time that the Nasdaq closed above
3,000 and the Dow above 13,000 on the same day, also lifted by
U.S. February retail sales recording their largest gain in five
months despite rising gasoline prices.
"The U.S. economic picture has clearly brightened, monetary
easing efforts have increased liquidity and boosted equities
worldwide and, despite the fact that Japanese investors are
heading into the book-closing period, demand remains strong,"
said Hiroichi Nishi, equity general manager at SMBC Nikko
But lingering concern about the impact of rising gasoline
prices on U.S. consumer spending, and debt problems in Portugal
and Spain meant the market was not free of worries.
"I do worry that we are in a goldilocks market that may be
overheated," said Bayview's Sakuma.
The benchmark Nikkei was in "overbought" territory, with its
14-day relative strength index near 77.8. Seventy or above is
March is the final month of Japan's fiscal year, and market
participants have been expecting many funds to lock in profit
from the benchmark's 19.5 percent rally since the beginning of
January, after shedding more than 13 percent in April to