Nikkei claws higher, boosted by weaker yen and oil

By Elaine Lies

TOKYO (Reuters) - Japan's Nikkei stock average climbed 0.6 percent to its first positive close in three days on Monday, boosted by a retreat of the yen against the dollar that lifted exporters and gains in Nippon Oil Corp (5001.T: Quote, Profile, Research) and other oil-linked firms as oil hovered close to record levels.

Additional upward energy came from Konica Minolta Holdings (4902.T: Quote, Profile, Research), which surged 12.1 percent for its greatest one-day percentage gain in more than seven years on a brokerage upgrade and comparatively good earnings.

But gains were capped by losses in automakers such as Honda Motor Corp (7267.T: Quote, Profile, Research), dragged down after Toyota Motor Co (7203.T: Quote, Profile, Research) posted poor results last week.

Financials such as top lender Mitsubishi UFJ Financial Group (8306.T: Quote, Profile, Research) also slid after a massive loss by American International Group (AIG.N: Quote, Profile, Research) revived worries about the sector.

Mainly, though, the market floundered in search of direction amid thin trade.

"The market's being spun around a bit by currencies, and there's a little bargain hunting, but mainly investors are shying away from taking fresh positions ahead of Japanese GDP data on Friday and bank earnings later this week," said Tomomi Yamashita, a fund manager at Shinkin Asset Management.

"Today there's no real direction and it's hard to read what lies ahead."

Others said that the market was consolidating after rising above 14,000 last week to hit a four-month high and that this could set the stage for more gains in the future as risks are gradually cleared away.  Continued...