Nikkei jumps 3 pct, trading houses and banks gain

*Nikkei up 3 percent as trading houses, banks gain

*Banks rise on relief U.S. bank earnings not as bad as feared

*Market gains pick up after bond futures trade resumes (Adds stocks, details)

By Taiga Uranaka

TOKYO, July 22 (Reuters) - Japan's Nikkei stock average jumped 3 percent on Tuesday as Itochu Corp (8001.T) and other trading houses climbed on overnight gains in oil, while financials rose on relief major U.S. banks' earnings were not as bad as feared.

Shin-Etsu Chemical Co Ltd (4063.T), the world's biggest maker of silicon wafers, gained sharply after it reported a 13 percent rise in quarterly profit. [ID:nT303306]

Toyota Motor Corp (7203.T) raced higher as investors saw the automaker and other recently battered blue-chip exporters as bargains.

After spending much of the day within a narrow range, the market accelerated its gains after trading in Japanese government bond futures was resumed in the late afternoon. A system glitch had forced the Tokyo Stock Exchange earlier to suspend trade of JGB futures, TOPIX index futures and other derivatives.

"The system trouble had an impact on the stock market as it took away arbitrage trading between bonds and stocks," said Masayoshi Yano, senior market analyst at Meiwa Securities, adding that the resumption of trade removed a lid on the market's gains.

"Investors took relief from U.S. banks' earnings, especially Citi. They were not as bad as feared," he said.

The benchmark Nikkei .N225 ended up 381.26 points at 13,184.96, while the broader Topix .TOPX rose 2.8 percent to 1,287.74. Markets were closed on Monday for a national holiday.

Itochu jumped 8.6 percent to 1,075 yen, the biggest percentage gainer on the Nikkei. Mitsui & Co (8031.T) gained 6.6 percent to 2,170 yen.

Oil rose on Monday as a tropical storm threatened the Gulf of Mexico and stoked concerns of disruptions to U.S. offshore oil and gas production [O/R].

Toyota climbed 5.6 percent to 4,910 yen and Honda Motor Co (7267.T) rose 5.3 percent to 3,600 yen.

Shin-Etsu Chemical, one of the first major Japanese firms to report April-June results, added 5.2 percent to 6,640 yen. Its quarterly profit was buoyed by solid sales of silicon wafers worldwide, sales of construction materials in emerging markets and an accounting change. (Editing by Chris Gallagher)