* Nikkei set to post 12th straight week of gains * Sharp up on strong profit optimism * Softbank rises on rosy earnings * Investors eye mid-to-long term theme in Japanese stocks-analyst By Ayai Tomisawa TOKYO, Feb 1 (Reuters) - Japan's Nikkei average rose on Friday morning and is set to post its 12th straight week of gains, as investors bought companies that sparkled during the earnings season, while expectations of a recovery in the U.S. economy supported sentiment. The Nikkei rose 0.4 percent to 11,177.33 by the midday break after hitting a new 33-month high of 11,220.42. The index has gained 2.3 percent this week, putting it on track for a 12th straight week of gains, the longest run of weekly gains since 1959. With earnings in full swing, Sharp Corp gained 2.9 percent to 320 yen after sources familiar with the matter told Reuters the company is set to post its first operating profit in five quarters in the three months through December on strong sales of home appliances and mobile phones. Japan's third-largest mobile carrier, Softbank Corp , jumped 5.2 percent to 3,430 yen after posting a 23.7 percent rise in operating profit in the third quarter, thanks to strong subscriptions from iPhone users. It also said it was on track to hit its annual operating profit target of 700 billion yen ($7.76 billion) this financial year. "While many exporters disappoint the market with worse-than-expected results, those reporting good figures shine," said Shun Maruyama, chief Japan equity strategist at BNP Paribas. He also said that investors, who had added exporters to their portfolios on the back of a weakening yen, have started to shift to sectors sensitive to the domestic economy. The Nikkei has gained about 30 percent since mid-November, when Shinzo Abe, then a candidate for leader of the opposition and now prime minister, began calling for aggressive monetary easing in his election campaign. Financials and real estate, which could benefit from Abe's reflationary policies, have caught up with rises in exporters. While the auto sector has gained 46 percent since mid-November, banking has added 40 percent and real estate has advanced 33 percent in the same period. "They are looking for a mid-to-long term theme in Japanese shares as the yen's sharp weakness will not last forever. That's a sign that they see upside in the Japanese market in the longer term, and people are counting on stocks which are expected to fare well if the country is out of deflation," Maruyama said. So far, Japanese companies have reported lacklustre earnings for the Oct-Dec period: Of the 54 Nikkei companies that have announced quarterly results so far, nearly two-thirds have missed market expectations, according to Thomson Reuters StarMine. That compared with 56 percent in the previous three months. Companies reporting their results on Friday include Panasonic Corp, Sharp and Mitsubishi UFJ Financial Group. But market observers said that investor focus is on forecasts for the full year through March as well as the year ending March 2014 - if companies have a strong outlook for the foreseeable future, the market will likely dismiss poor results. "Unless companies reporting poor quarterly results disappoint investors with even more gloomy estimates, bad news should be seen as a past event," said Hiroichi Nishi, an assistant general manager at SMBC Nikko Securities. "Investors' risk appetite is being supported by underlining hope for 'Abenomics' and expectations for the recovering global economy. The United States nonfarm payrolls report is forecast to show a rise of 160,000 jobs and the unemployment rate to remain steady at 7.8 percent. The broader Topix added 0.4 percent to 943.74, with 1.95 billion shares changing hands by the midday break, on track to chalk up heavy volume by the end of the day. Last week's average daily volume was 3.44 billion shares.