Nikkei rises as weak yen lifts exporters; oil shares underperform
* Volume weak due to worries about Japan's growth - analysts * Oil shares drop after Brent crude falls By Ayai Tomisawa TOKYO, Sept 9 (Reuters) - Japan's Nikkei share average rose modestly on Tuesday after the yen dropped to a six-year low against the dollar, lifting exporters such as Honda Motor Co and Sony Corp, but weak crude oil prices weighed on energy shares. The Nikkei rose 0.4 percent to 15,774.21 points by mid-morning, moving close to its seven-month high of 15,829.38 hit last week. The dollar rose to a six-year high of 106.09 yen. Honda gained 1.2 percent and Sony added 1.3 percent, while Advantest Corp advanced 2.5 percent. A weaker yen helps Japanese exporters' competitiveness abroad as well as their profits when repatriated. Analysts said that while most companies have based their foreign currency assumptions at around 100 yen for the fiscal year through March, the current dollar-yen level is serving as a tailwind to major exporters. According to Nomura Securities, companies listed on the Topix are expected to post a total of 61.5 trillion yen ($580 billion) in operating profits for the year through March, and when the yen weakens by 1 yen against the dollar, it would lift the aggregate operating profits by 300 billion yen. But they also added that thin volume was a concern as some investors remain on the sidelines in the wake of weak Japanese economic data. "Investors are uncertain about Japan's growth so they want to wait until good news comes out (before investing aggressively)," said Hiromichi Tamura, chief strategist at Nomura Securities, citing Monday's revised Japanese GDP report, which showed the economy contracted more than initially expected in the second quarter. Oil shares and trading houses underperformed, with Inpex Corp falling 1.2 percent, Mitsubishi Corp <8058.T. shedding 0.1 percent and Sumitomo Corp declining 0.1 percent after Brent crude fell below $100 a barrel for the first time in 16 months. The broader Topix gained 0.1 percent to 1,299.89 and the JPX-Nikkei Index 400 added 0.1 percent to 11,793.02. (1 US dollar = 106.0200 Japanese yen) (Editing by Kim Coghill)
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