Nikkei rises to highest since July 2008, developers and banks gain
* Autos remain attractive among exporters - traders * 100 yen to dollar big milestone - fund * More buying may be seen if yen weakens to 100 to dollar - fund By Ayai Tomisawa TOKYO, April 11 (Reuters) - Japan's Nikkei share average rose to its highest level since July 2008 on Thursday morning as the central bank's unprecedented stimulus measures continued to lure buyers for reflationary stocks like property developers and banks. The Nikkei rose 1.3 percent to 13,455.70 in mid-morning trade after earlier rising to 13,496.28, the highest since July 2008. Analysts said a rise in U.S. stocks to record highs also underpinned Japanese equities. Reflationary stocks like financials and asset-related shares attracted buying, while auto shares outperformed on hopes that a weakening yen will lift their earnings. Mitsui Fudosan Co gained 2.5 percent and Mitsubishi Estate Co added 2.1 percent, while Mitsubishi UFJ Financial Group rose 2.4 percent. "The current theme in the market is 'beating deflation', not the weak yen, so although a weak yen should lift exporters to some extent, asset-related stocks and financial stocks are more attractive to foreigners," said Kenichi Hirano, a strategist at Tachibana Securities. He added that lingering worries about the euro zone's debt problems and growth in emerging markets may cap investor appetite for exporter shares. But traders said that investors are selective, and among bellwether exporters, autos remain popular among foreign investors as they are highly competitive in the global market compared to electronics. Toyota Motor Corp rose 5.1 percent, Honda Motor Co gained 3.0 percent, while Sony Corp added 1.7 percent. The Topix gained 1.5 percent to 1,137.08. The massive stimulus steps unveiled by the Bank of Japan last week and the government's fiscal expansionary measures have continued to drive demand for Japanese equities. The Nikkei has surged over 50 percent since November and the yen has fallen to four-year lows versus the dollar on the back of the bold monetary and fiscal expansionist policies. Before the opening bell, Japan's February machinery orders data was out, which rose at the fastest pace in since mid-2011 in a sign that capital spending could pick up this year. "It may take a while to see companies increase capital spending, but the figures were generally good," said Masaru Hamasaki, a senior strategist at Sumitomo Mitsui Asset Management. But further gains in the Nikkei will likely depend on the yen's move, he said. "As long as the dollar is hovering just below 100 yen, investors may not chase the market higher. The 100-mark is a big milestone, so if it reaches that level, more buying will be seen." The yen last traded at 99.56 yen to the dollar. On Wednesday, the dollar hit a four-year high of 99.88 yen .