Nikkei up 6.3 pct, Panasonic jumps but Nissan dives

*Nikkei up 6.3 pct as exporters climb, highest close in 2 wks

*Panasonic and Sanyo jump, Nissan slides

*Bank shares boosted by positive brokerage report

*Trade volume moderate as eyes turn to U.S. election (Adds stocks, details)

By Elaine Lies

TOKYO, Nov 4 (Reuters) - Japan's Nikkei rose 6.3 percent to a two-week high on Tuesday as investors bought back exporters on a softer yen and relief over a quiet three-day weekend, with Panasonic (6752.T) jumping after sources said it was planning to take over Sanyo Electric (6764.T).

Shares of big Japanese banks such as Mitsubishi UFJ Financial Group (8306.T) and Mizuho Financial Group (8411.T) advanced after Credit Suisse raised its stance on the sector to "overweight", saying that all bad earnings news is likely out after a series of profit warnings last week [ID:nT278524]

But Nissan Motor Co (7201.T) tumbled 10.6 percent after it more than halved its annual profit forecast and retracted its dividend target, hit by a slumping market and a strong yen. [ID:nT269546]

Trade was thin, with many investors reluctant to buy actively ahead of the U.S. presidential election, a factor that also dampened activity in New York on Monday, when Japanese markets were closed for a holiday [.N].

"While people are holding back a bit ahead of the election, their big concern is less who wins than whether the result will be decided quickly or not," said Takashi Ushio, head of the investment strategy division at Marusan Securities.

"The worst thing would be an extended political vacuum, with no sign of what economic policies could be expected."

In 2000, the election won by U.S. President George W. Bush was not finally decided until well into December, but trends in Tuesday's race between Democrat Barack Obama and Republican John McCain could become clear soon after the first polls begin to close at 6 p.m. EST (2300 GMT) in Indiana. [ID:nN02489102]

The benchmark Nikkei .N225 ended up 537.62 points at 9,114.60. The broader Topix was up 5 percent to 910.70 points.

Tokyo markets were closed on Monday for a holiday.

Market participants said much of Tuesday's movements centred on short covering following a sharp sell-off ahead of the three-day weekend. Lehman Brothers collapsed on a three-day weekend in September, and Japanese investors have been shy of potential financial turmoil over long weekends ever since.

The Nikkei tumbled 5 percent on Friday, capping off its worst month in its 58-year history.