Nikkei up 1.8 pct as Sony, exporters gain

(Updates to midmorning)

TOKYO, May 29 (Reuters) - Japan's Nikkei average rose 1.8 percent on Thursday, led by high-tech exporters such as Sony Corp (6758.T: Quote, Profile, Research, Stock Buzz) on a softer yen and after Wall Street was buoyed by signs of stronger business spending.

Japan Steel Works Ltd (5631.T: Quote, Profile, Research, Stock Buzz) gained 3.7 percent to 2,130 yen after Mitsubishi UFJ Securities lifted its target price to 3,250 yen from 2,300 yen, citing potential global demand growth for nuclear reactors.

Takahiko Murai, general manager of equities at Nozomi Securities, said the market largely rebounded after the previous day's sell-off, but the benchmark Nikkei is unlikely to be able to stay above the 25-day moving average of around 14,000.

"Durable goods data is a very volatile indicator and I doubt the situation will improve just because they reported a big jump this time," he said.

U.S. stocks rose on Wednesday after a government report on orders for durable goods -- long-lasting manufactured items -- showed a surprising jump in business investment last month.

"If poor economic data were to come out, stocks would be sold again. The overly optimistic views that the U.S. economy will recover later this year may have to be corrected as further losses at financial institutions are still looming," Murai said.

As of 0042 GMT, the Nikkei .N225 added 244.84 points to 13,954.28 after falling 1.3 percent the previous day.

The broader Topix index advanced 1.3 percent or 17.94 points to 1,366.63.