Nikkei gains as techs, banks, trading houses rise

By Elaine Lies

TOKYO (Reuters) - Japan's Nikkei average rose 1.3 percent on Tuesday, buoyed by Wall Street's gains as interest in risk-taking rose, with Mitsubishi Corp (8058.T) and other trading firms up reflecting climbs in oil, gold and other commodities prices.

Tokyo Electron (8035.T) and other chip-related shares climbed following gains by their U.S. peers, after the Dow rose to a 13-month high and other Wall Street indexes gained after the Group of 20 pledged to keep aid flowing to the world economy, encouraging investor appetite for risk.

But analysts said long-term uncertainty was likely to keep a lid on gains in Japan.

"Things are definitely getting brighter for the short term, but over the longer term there's quite a lot of uncertainty that's preventing rises in Japanese stocks," said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.

"Will there be more government bond issuance? Will the yen continue to rise? And what sort of policies can we expect from the government?"

The benchmark Nikkei .N225 gained 128.68 points to 9,937.67 by midafternoon. The broader Topix , which is not as heavily tech-centered, rose 0.8 percent to 878.00.

Analysts said the Nikkei faces resistance around 10,000, just about where the 25-day moving average comes in, but if it gains upward momentum it could quickly punch through that level.

The next key technical level is 10,200, which is where the Nikkei's 75-day moving average comes in, said Kenichi Hirano at Tachibana Securities.