Nikkei hits 8-mth closing high on yen, US jobs data

* Nikkei boosted by weaker yen, U.S. jobs figures

* Komatsu surges on favourable brokerage ratings

By Shinichi Saoshiro

TOKYO, June 8 (Reuters) - Japan's Nikkei average gained 1 percent on Monday to hit an eight-month closing high, after better-than-expected U.S. jobs data raised hopes for an economic recovery and a weaker yen cheered exporters such as Canon Inc (7751.T) and Toyota Motor Corp (7203.T).

Komatsu Ltd (6301.T) surged 6 percent after Nomura Securities upgraded the construction machinery maker's rating to "buy" and Morgan Stanley started coverage at "overweight".

Exporters led the market's gains after the dollar hit a one-month high on Friday near 99 yen JPY= when the jobs report showed the United States shed 345,000 jobs in May, well below the 520,000 expected by economists. [ID:nN05274048] [FRX/]

Digital camera maker Canon jumped 3.4 percent to 3,360 yen and Sony Corp (6758.T) added 0.6 percent to 2,710 yen.

Honda Motor Co (7267.T) advanced 1.6 percent to 2,895 yen, while Toyota rose 1.3 percent to 3,910 yen.

"Investors are welcoming the weaker yen and the better-than-expected U.S. jobs report," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

The benchmark Nikkei .N225 gained 97.62 points to 9,865.63, its highest close since Oct. 7.

The broader Topix added 1.1 percent to 926.89.

The focus is now on when the Nikkei will be able to reclaim the psychologically important 10,000 mark.

"The market has the momentum to reach 10,000 within the next few days," said Yoshinori Nagano, a senior strategist at Daiwa Asset Management.

"The question is if the index can remain above 10,000. Most participants already expect an economic recovery to take place after a recent run of upbeat data, so the market will be vulnerable to profit-taking at that level."

The jobs data released on Friday also showed that the U.S. unemployment rate hit 9.4 percent, its highest since 1983, and market watchers warned the road to recovery for the global economy is looking rocky.

KOMATSU, HITACHI CONSTRUCTION JUMP

Komatsu Ltd climbed 6 percent to 1,560 yen after Nomura Securities lifted its rating on the stock to "buy" from "neutral" and raised its target price to 1,900 yen from 1,430 yen.

"We see a growing possibility of an earnings recovery from the year ending in March 2011 on a bottom in emerging markets and Komatsu's solid competitiveness and cost control," the brokerage wrote in a note to clients.

On Friday, Morgan Stanley initiated coverage of Komatsu with an "overweight" rating and Hitachi Construction Machinery Co (6305.T) with an "equal-weight" rating, citing the potential for profit growth as the global economy recovers.

Shares of Hitachi Construction climbed 4.6 percent to 1,720 yen.

Nomura Holdings Inc (8604.T) rose 4.9 percent to 800 yen after Morgan Stanley raised its rating on Japan's largest brokerage to "overweight" from "equal-weight", citing an improved medium-term profit outlook.

JGC Corp (1963.T) shot up 4.4 percent to 1,609 yen after the Nikkei business daily reported that the plant engineering firm had won a 150 billion yen ($1.5 billion) order for a natural gas project in Algeria.

But chip-related stocks declined after Intel Corp (INTC.O), the world's top chip maker, slid on Friday in the wake of an industry forecast for a steep drop in global chip sales. [ID:nBNG480632] The Philadelphia semiconductor index .SOXX dropped nearly 2 percent.

Advantest Corp (6857.T) slid 1.9 percent to 1,862 yen, while Tokyo Electron Ltd (8035.T) shed 3.9 percent to 4,710 yen to become the top drag on the Nikkei 225.

Nippon Paper (3893.T) shed 3 percent to 2,575 yen as rising oil prices and a weaker yen hurt paper makers, which depend on imported materials.

The paper and pulp subindex IPAPR.T lost 1.8 percent on Monday to post the biggest drop among the subindexes.

Trade was subdued on the Tokyo exchange's first section, with 2.3 billion shares changing hands, almost in line with last week's daily average of 2.4 billion.

Advancing stocks outnumbered declining ones by more than 2 to 1. (Additional reporting by Aiko Hayashi; Editing by Chris Gallagher)