Nikkei up 1.1 pct, exporters and financials gain
*Nikkei rises, led by exporters and banks
*Strong results by Wells Fargo give boost to financials
*Caution remains ahead of U.S. financial earnings (Adds comments and stocks)
TOKYO, July 17 (Reuters) - Japan's Nikkei average rose 1.1 percent on Thursday, led by exporters such as Canon Inc (7751.T) on a rebound in the dollar versus the yen, while financial stocks jumped after surprisingly strong results from a U.S. bank helped ease credit worries.
Major brokerages, including No. 1 Nomura Holdings (8604.T), gained more than 5 percent, positioning the market for its biggest percentage gain in one month.
"With the subprime problems still out there, it does not mean a trend change, but we are seeing a short-term rebound led by recently battered banks and exporters," said Norio Shimura, deputy head of the equity department at Chuo Securities.
Investors felt relatively comfortable about buying exporters after the dollar gained ground back to around 105 yen JPY= from around 103 yen a day earlier, he added.
The benchmark Nikkei .N225 ended the morning up 141.59 points at 12,902.39. The broader Topix gained 1.5 percent to 1,268.00.
U.S. stocks rallied more than 2 percent on Wednesday, powered by the best day for banks in 16 years as unexpectedly robust earnings from Wells Fargo & Co helped ease concerns about a credit crisis spiralling out of control. [ID:nN16284000]
But analysts said caution was limiting the market's advance.
"The Tokyo market is not quite tracking the sharp gains on Wall Street which underscores the strong anxiety felt by investors," said Kazutaka Oshima, chief strategist at Rakuten Securities.
"Wells Fargo did give a boost to the market, but this bank is not investors' biggest concern. They are waiting for Merrill and Citi," he said, referring to earnings by Merrill Lynch MER.N later in the day and Citigroup (C.N) on Friday.
BROKERAGES JUMP
Brokerages were among the biggest percentage gainers on the Nikkei, with Nomura jumping 5.4 percent to 1,536 yen.
No. 2 Daiwa Securities Group Inc (8601.T) rose 5 percent to 922 yen. The company said it is in a business tie-up with Brazil's Banco Itau (ITAU4.SA) and the two firms will join hands in areas such as asset management and investment banking. [ID:nT241935]
Digital camera maker Canon rose 2.2 percent to 5,010 yen and Toyota Motor Corp (7203.T), which fell to a near three-year low on Wednesday, gained 1.7 percent to 4,720 yen.
Among banks, which have been hit hard by deepening worry about the global credit crisis, Mitsubishi UFJ Financial (8306.T) gained 5 percent to 973 yen and Mizuho Financial Group (8411.T) climbed 4.8 percent to 545,000 yen.
Trade was thin, with some 807 million shares changing hands compared to last week's morning average of 926 million.
Advancers outpaced decliners by more than 3 to 1.
