Nikkei marks best gain in 6 weeks on Citi, techs

* Nikkei gains 4.6 pct, biggest rise since Jan 27

* Banks boosted after Citi news, techs also lead

* Rebound fragile but market may be near turning point

* Toshiba soars over 9 pct on reports of profit

* Trade moderate, in line with last week's daily average

By Elaine Lies

TOKYO, March 11 (Reuters) - Japan's Nikkei average jumped 4.6 percent on Wednesday, posting its biggest rise in 6 weeks a day after hitting a 26-year closing low, as financial shares gained after Citigroup's (C.N) chief executive said the U.S. bank was making profits.

Toshiba Corp (6502.T) shot up more than 9 percent after a newspaper reported it may achieve an operating profit of about 100 billion yen ($1 billion) next business year, while other tech shares climbed in the wake of strong gains by their U.S. peers. U.S. stocks posted their best day in four months on Tuesday after Citigroup Chief Executive Vikram Pandit said the company was profitable in the first two months of 2009 and voiced confidence about its capital strength, easing concerns about the bank's survival prospects. [ID:nLA390055]

"Tokyo shares were saved by the United States, and whether the rally continues or not depends largely on what Wall Street does tonight," said Masayoshi Okamoto, head of dealing at Jujiya Securities. "Given the probable buying by public pension funds anytime the Nikkei heads close to 7,000, I think we're unlikely to break below that this month. But going over 7,500 is equally unlikely due to profit-taking."

The market mostly shrugged off data showing Japan's core private-sector machinery orders fell 3.2 percent in January from the previous month, slightly better than a median market forecast for a 4.5 percent fall. [JPMORD=ECI]

"Economic indicators are still bad, but inventories are decreasing, and there's been some improvement in service sector sentiment," said Takashi Ushio, head of the investment strategy division at Marusan Securities.

"While there's still the chance we could fall below 7,000, it wouldn't be the start of any plunges. I think we may be close to a turning point."

The benchmark Nikkei .N225 gained 321.14 points to 7,376.12, marking its biggest one-day percentage gain since Jan. 27 and coming right after it ended Tuesday at 7,054.98, its lowest close since October 1982.

The broader Topix .TOPX rose 2.7 percent to 722.28.

BANKS BOLSTERED

Financials surged in the wake of the Citigroup news, though most trimmed their gains by the close.

Mitsubishi UFJ Financial Group (8306.T), Japan's top lender, rose 4.1 percent to 411 yen. Mizuho Financial Group (8411.T) climbed 5.4 percent to 176 yen and Sumitomo Mitsui Financial Group (8316.T) gained 4.8 percent to 2,820 yen.

Resona Holdings (8308.T), Japan's fourth-largest bank, missed the updraught to drop 4.6 percent to 1,564 yen after Credit Suisse downgraded its shares to "neutral" from "outperform" and lowered the target price to 1,490 yen from 1,650 yen.

The downgrade came after Resona, effectively nationalised after it nearly collapsed under a mountain of bad loans, said on Tuesday it will return $1.8 billion of bailout money by buying back preferred shares from the government, as the bank continues to chip away at its massive public debt. [ID:nT332459]

Kyocera Corp (6971.T) and other tech shares climbed after U.S. bellwethers such as Apple Inc (AAPL.O) jumped on Tuesday, halting a three-day sell-off in the sector and sending the Philadelphia Semiconductor Index .SOXX up 8.1 percent.

Kyocera rose 6.6 percent to 5,950 yen and Canon Inc (7751.T) climbed 6.6 percent to 2,275 yen. TDK Corp (6762.T) rose 8.3 percent to 3,390 yen and Advantest Corp (6857.T) gained 5.9 percent to 1,287 yen.

Real estate investor Pacific Holdings Inc 8902.T remained untraded with a glut of sell orders at 1,614 yen, down 300 yen or 15.7 percent from Tuesday's close, after it filed for bankruptcy protection with about $1.65 billion in debt, the country's third-biggest failure this year. [ID:nT331091]

Trade was moderate on the Tokyo exchange's first section, with 2 billion shares changing hands, in line with last week's daily average.

Advancing stocks outpaced declining ones by more than 3 to 1. (Editing by Michael Watson)