* Brokerage shares best performers due to pension reform
* Exporters gain as yen falls near 5-year low
* Fuji Heavy hits record high
By Hideyuki Sano
TOKYO, Sept 3 Japanese shares hit a seven-month
high on Wednesday, with brokerages leading the gains because of
hopes that a cabinet reshuffle by Prime Minister Shinzo Abe will
give fresh impetus to his growth-oriented policies.
Exporters' shares also rode high as the yen weakened to an
eight-month low and as solid U.S. manufacturing data boosted the
prospects for their business, even though U.S. shares ended
mixed the previous day.
The Nikkei share average rose 0.8 percent to
15,788.65, the third consecutive day of gains, which took the
market to levels not seen since late January.
"The line-up of Abe's new cabinet and top party posts are
positive for Japanese stocks on three fronts, if it is as
reported," said Ryota Sakagami, chief strategist at SMBC Nikko
"You can expect faster reforms. This will lead to unity in
the party and strengthen his government, and the number of women
in the main posts is the highest ever," he said.
Abe is due to announce his new cabinet later in the day but
media have already reported that Yasuhisa Shiozaki, a proponent
of an overhaul of Japan's Government Pension Investment Fund
(GPIF), will head the ministry of labour, health and welfare,
which oversees the GPIF.
Shiozaki has called for the GPIF, which is drawing up plans
to boost the weighting of domestic stocks in its portfolio, to
buy stocks directly rather than through asset managers.
Hopes that GPIF money could galvanise the share market gave
a fillip to brokerage shares, which rose 1.2 percent
to extend their gains so far this week to 4.0 percent, the best
showing among the 33 industry sub-indexes on the Tokyo Stock
Nomura Holdings rose 1.1 percent while Daiwa
Securities Group went up 1.5 percent.
The yen's fall against the dollar helped exporters.
Fuji Heavy Industries rose 2.9 percent to a record
high while Mazda gained 1.7 percent.
Among the largest companies, Panasonic gained 1.7
percent and construction equipment maker Komatsu rose
1.4 percent, setting a 10-month high at one point. Robot maker
Fanuc rose 2.4 percent.
The yen traded at 105.21 yen to the dollar, near a
five-year low of 105.45 hit in January.
U.S. factory activity was at its strongest level in nearly
3-1/2 years in August, while construction spending rebounded
strongly in July, a further boost for exporters.
"I guess U.S. shares did not benefit much from the data
because it could mean an earlier rate hike but for Japanese
exporters, signs of a strong U.S. economy is positive," said
Soichiro Monji, chief strategist at Daiwa SB Investments.
The broader Topix rose 0.6 percent and the new
JPX-Nikkei Index 400 gained the same amount.
(Editing by Alan Raybould)