Nikkei rebounds as pessimism eases about China-related firms

* Japan Airlines trades above IPO price
* China-related firms bounce back as worries ease
* BOJ eyed for policy decision on further easing

By Sophie Knight
TOKYO, Sept 19 (Reuters) - Japan's Nikkei share average
climbed in early trade on Wednesday as stocks of firms with
exposure to China recovered after anti-Japan protests in the
country did not intensify, while hopes for further monetary
easing by the Bank of Japan lent support.
Japan Airlines Co Ltd's public re-listing drummed
up strong demand, opening at 3,810 yen and trading at 3,840 yen
by mid-morning, 1.3 percent above its initial public offering
price of 3,790 yen per share. It was the most-traded stock on
the main board.
The IPO is the second-biggest in the world this year after
social network Facebook Inc's $16 billion offering, and
will raise 663 billion yen ($8.4 billion).
The Nikkei picked up 0.6 percent to 9,178.28, helped
by gains for firms with exposure to China that were heavily sold
off on Tuesday after anti-Japan protests in China sparked by a
territorial dispute led to closures of Japanese factories and
shops.
"Fast Retailing's rebound is propping up the Nikkei in the
same way that its fall yesterday dragged it down," said Masato
Futoi, head of cash equity trading at Tokai Tokyo Securities.
Fast Retailing Co Ltd recovered 3.2 percent,
contributing 20 positive points to the benchmark, after sliding
7 percent on Tuesday, when the company closed more than 40 of
its Uniqlo casual clothing stores throughout the country.
The broader Topix gained 0.3 percent to 760.93.
"Since the situation neither improved nor worsened yesterday
it's likely some people will be buying back shares that were
heavily sold off yesterday on a worst-case scenario," said
Masayuki Doshida, senior market researcher at Rakuten
Securities.
Nissan Motor Co rebounded 1.3 percent after the
company said it will resume production at four plants in
Guangzhou and Zhengzhou in China on Wednesday after having
halted operations there following anti-Japanese demonstrations.

The market was also buoyed by a softer yen, which prevented
a sharper fall on Tuesday, although the currency's movements
will likely depend on whether the Bank of Japan decides to ease
further at the conclusion of its two-day policy meeting ending
later on Wednesday.
"I think there's about a 60 percent chance of the BOJ
easing," said Doshida. "The European Central Bank's decision to
buy sovereign bonds and the U.S. Federal Reserve introducing QE3
has put pressure on the bank to follow suit to avoid the yen
strengthening."
However, Doshida also said that the BOJ may decide to hold
fire this time, as it waits for the outcome of its "tankan"
survey of corporate sentiment at the end of the month.
The real estate sector was the worst-performing
sub-index on the Topix, slipping 0.4 percent in a reflection of
investor uncertainty around the BOJ's decision.