Nikkei hits 15-month high but gains limited; JAL down

TOKYO (Reuters) - Japan's Nikkei stock average hit a 15-month high on Friday, with chip-related shares climbing on increasing global demand for high-tech products, but gains were capped by profit-taking ahead of key U.S. jobs data.

Japan Airlines 9205.T tumbled nearly 12 percent on growing bankruptcy worries, with the Nikkei business daily saying the government has firmed up its stance to put JAL through a bankruptcy procedure as part of a plan led by a state-backed turnaround fund.

Exporters advanced on the back of the dollar's earlier rise to its highest level since August against the yen, but gains were limited as investors sought to lock in profits ahead of U.S. non-farm payrolls data due later on Friday, particularly since Japan is heading into a three-day weekend.

The latest Reuters poll suggests the U.S. economy stopped shedding jobs in December. .N

"While the jobs data is important, one of the biggest things will be how the markets themselves react, especially how the dollar moves against the yen," said Masayoshi Okamoto, head of dealing at Jujiya Securities.

"But Japan won't be able to trade on these factors until Tuesday, so some people are looking to cash out now, especially since the Nikkei has gotten pretty high."

In active trade, the benchmark Nikkei .N225 rose 1.1 percent or 116.66 points to 10,798.32 after earlier climbing as far as 10,816.45, its highest since October 2008. It rose 2.4 percent on the week for its sixth straight week of gains.

The broader Topix .TOPX rose 1 percent to 941.29.

"It's pretty hard to predict what stocks may do next week at this point, but if the dollar manages to hold at 93 yen or above, the Nikkei is likely to consolidate around the 10,700 to 10,800 level," said Noritsugu Hirakawa, a strategist at Okasan Securities.

"Then eyes will start to turn to quarterly earnings, which really get going in late January."

JAL, EXPORTERS

JAL fell 11.8 percent to 67 yen.

A state-backed turnaround fund is in negotiations with the government and creditors on a plan to support the carrier with an injection of fresh capital if it files for bankruptcy and can get debt forgiveness from its banks, sources have told Reuters.

The Nikkei said the government would finalize its decision as early as January 12 and the carrier could file for bankruptcy around January 19.

"The current JAL share price hasn't fully factored in a

bankruptcy scenario," said Takahiko Kishi, senior analyst at Mizuho Investors Securities.

"If the court-led restructuring really takes place, then their shares can easily be knocked down to the 20 or 30-yen level."

The dollar hit a four-month high against the yen early on Friday, but gave back some ground after Finance Minister Naoto Kan said currency levels should be determined by markets, backtracking from his earlier call for a weaker yen after an apparent rebuke from the prime minister.

By late trade, the greenback was down 0.1 percent at 93.27 yen.

Automakers gained as the weaker yen boosted earnings prospects, with exporters rising as well, though many were off earlier highs.

Investors welcome a weaker yen because it boosts exporter profits when repatriated.

Honda Motor Co (7267.T) rose 3.1 percent to 3,185 yen, Toyota Motor Corp (7203.T) rose 2.9 percent to 3,960 yen and Nissan Motor Co (7201.T) gained 2.2 percent to 807 yen.

Chip-test maker Advantest Corp (6857.T) rose 3.7 percent to 2,457 yen and Tokyo Electron (8035.T) gained 2 percent to 6,000 yen.

Trade was active on the Tokyo exchange's first section, with 2.6 billion shares changing hands, above last week's daily average of 1.6 billion.

Advancing stocks outnumbered declining ones by more than 2 to 1.

(Reporting by Elaine Lies; Editing by Edwina Gibbs)