CORRECTED-Nikkei ekes out gains but Europe optimism fades

(Corrects second paragraph after subheading to say Japan Tobacco was the second-heaviest traded issue by turnover, not heaviest)

* Nikkei up 0.1 percent, volumes light as investors wary

* Euro rally stalls, cuts risk appetite

* Some selling as half TSE shares ex-dividend -strategist

* Japan Tobacco down after 3-yr high on talk of govt sale

By Vikram Subhedar

TOKYO, Sept 28 (Reuters) - Japanese shares inched up on Wednesday but struggled to hold gains with traders selling into strength as optimism over Europe's efforts to resolve its sovereign debt problem proved short-lived and support from dividend-related buying faded.

Turnover on the Tokyo bourse remained light, suggesting investors preferred to wait on the sidelines rather than chase gains, with European stock futures pointing to a lower opening across all major markets.

The Nikkei average closed up 0.1 percent at 8,615.65, with a 3.8 percent bounce in shares of telecoms firm Softbank providing the biggest boost to the index. Softbank hit a 15-month low in the previous session.

The broader Topix index closed up 0.7 percent at 754.07.

"It's hard to buy, with Greece's situation still unresolved. The euro's rise has stalled, and this is also weighing on sentiment and shares with European exposure," said Yumi Nishimura, a senior technical analyst at Daiwa Securities.

Plans to increase the financial firepower of the euro zone's 440 billion euro ($600 billion) rescue fund face opposition in Germany, while a Financial Times report said a split had opened up within the currency bloc over the terms of Greece's next bailout.

The market also lost the support of dividend-related buying that had helped push the Nikkei up nearly 3 percent in the previous session.

Tuesday was the last day for investors to buy many Japanese stocks and still get dividends on them for the April-September first half.

"About half the shares on the Tokyo Stock Exchange went ex-dividend today, so there is some selling related to that, as well as uncertainty about how developments in Europe will proceed, and this is making buyers cautious and limiting the upside," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

Plans under consideration call for leveraging the EFSF rather than increasing the size of the bailout fund, which would mean euro zone countries would not have to increase their guarantees for the fund but that the facility would be able to buy more debt than its cash would normally permit.

"Investors think, 'isn't the European situation better?' But we have no way of knowing for sure at this point, and until they're more confident, we probably won't see major buying," said Hiroichi Nishi, equity division manager at SMBC Nikko Securities Inc.

The Nikkei remained below its 25-day moving average, with shares of Fast Retailing , operator of budget fashion chain Uniqlo, down 3.8 percent, the biggest drag on the benchmark.

With the stock trading at a price-to-book multiple of 3.8 times, well ahead of the Japanese market, which trades at par with book value, it could face pressure as investors take profits in one of the relative outperformers this year, said a Hong Kong-based trader at an Asian brokerage.

ACTIVE TRADE

Shares of the world's third-biggest cigarette maker, Japan Tobacco , saw active trade on news that the government may sell off its 50 percent stake to find funds to rebuild northeast Japan after the March earthquake. Its shares soared to a three-year high before reversing course to trade down 2.9 percent.

Japan Tobacco was the second-heaviest traded issue by turnover, with volume reaching 2.7 times its 30-day full-day average.

Ruling Democratic Party, Seiji Maehara, also called for the sale of shares in energy companies held by the government, which include Inpex Corp and Japan Petroleum Exploration Co , to raise 700-800 billion yen ($9-10 billion).

Inpex rose 0.4 percent to 479,500 yen and Japan Petroleum Exploration added 1.3 percent to 2,860 yen, pulling back from earlier gains after a trade ministry official said the proposal for Japan's government to sell its holdings in energy-related firms runs counter to government policy.

About five shares advanced for every one that declined on the Tokyo stock exchange's main board.

($1 = 0.733 Euros; = 76.655 Japanese Yen) (Additional reporting by Lisa Twaronite)