Nikkei rises 6.3 percent

Japan's Nikkei rose 6.3 percent to a two-week high on Tuesday as investors bought back exporters on a softer yen and relief over a quiet three-day weekend, with Panasonic jumping after sources said it was planning to take over Sanyo Electric.
Shares of big Japanese banks such as Mitsubishi UFJ Financial Group and Mizuho Financial Group advanced after Credit Suisse raised its stance on the sector to "overweight", saying that all bad earnings news is likely out after a series of profit warnings last week.
But Nissan Motor Co tumbled 10.6 percent after it more than halved its annual profit forecast and retracted its dividend target, hit by a slumping market and a strong yen. Trade was thin, with many investors reluctant to buy actively ahead of the US presidential election, a factor that also dampened activity in New York on Monday, when Japanese markets were closed for a holiday.
"While people are holding back a bit ahead of the election, their big concern is less who wins than whether the result will be decided quickly or not," said Takashi Ushio, head of the investment strategy division at Marusan Securities.
"The worst thing would be an extended political vacuum, with no sign of what economic policies could be expected." In 2000, the election won by US President George W. Bush was not finally decided until well into December, but trends in Tuesday's race between Democrat Barack Obama and Republican John McCain could become clear soon after the first polls begin to close at 6 pm EST (2300 GMT) in Indiana.
The benchmark Nikkei ended up 537.62 points at 9,114.60. The broader Topix was up 5 percent to 910.70 points. Tokyo markets were closed on Monday for a holiday. Market participants said much of Tuesday's movements centred on short covering following a sharp sell-off ahead of the three-day weekend. Lehman Brothers collapsed on a three-day weekend in September, and Japanese investors have been shy of potential financial turmoil over long weekends ever since.
The Nikkei tumbled 5 percent on Friday, capping off its worst month in its 58-year history. "We're seeing investors buying and selling very clearly on factors linked to individual shares. So Panasonic is surging and Nissan is falling," said Hiroaki Osakabe, fund manager at Chibagin Asset Management.
"While you can say that markets are slightly reassured by a sense that things are settling down a bit more than last month, there's little comfort to be found in company earnings," Osakabe added. Shares of Panasonic gained 6.8 percent to 1,614 yen, after rising as much as 9.3 percent at one stage. Sanyo soared 34.5 percent, up by its daily limit to 195 yen. Mitsubishi UFJ Financial Group rose 4.9 percent to 627 yen and No 3 bank Sumitomo Mitsui Financial Group climbed 7.9 percent to 412,000 yen.
Mizuho Financial Group rose 7.1 percent to 248,400 yen. Trade was light on the Tokyo exchange's first section, with 2.26 billion shares changing hands, compared with last week's daily average of 3.01 billion. Advancing stocks beat declining ones by nearly 5 to 1.