Japan Nikkei powers higher, buoyed by exporters

(Updates to mid-morning)

By Elaine Lies

TOKYO, Aug 15 (Reuters) - Japan's Nikkei stock average climbed 0.4 percent on Friday as Canon Inc (7751.T) and other exporters powered higher thanks to a slightly weaker yen and a rise in U.S. shares sparked partly by lower oil prices. Shippers steamed higher following sharp gains in a key freight index, while Sumitomo Mitsui Financial Group (8316.T) clawed higher after it and other banks were mauled earlier this week. Oil CLc1 fell below $114 a barrel as a contraction in the euro-zone underscored the threat to global oil demand growth [O/R]. [ID:nLE725248]

"The trend is downward, with the global economy definitely slowing," said Takahiko Murai, general manager of equities at Nozomi Securities.

"The market is thinned today by people off for summer vacation, but we're seeing exporters rising on the weaker yen and buying of futures, though the cash market isn't quite following this lead."

The dollar was fetching around 109.66 yen after earlier rising to around 109.89 yen JPY=. FXNEWS

The benchmark Nikkei .N225 gained 47.69 points to 13,004.49, while the broader Topix rose 0.3 percent to 1,242.76.

Canon was the biggest contributor to the Nikkei 225's gain as it rose 1.9 percent to 5,260 yen, followed closely by industrial robot maker Fanuc Ltd (6954.T) with a rise of 1.5 percent to 8,720 yen. Sony Corp (6758.T) rose 1.7 percent to 4,220 yen.

Shippers were particularly strong after the Baltic Dry Index .BADI surged 4.6 percent on Thursday -- a second straight day of gains after a slide that had begun in early July. Mitsui O.S.K. Lines (9104.T) gained 3.3 percent to 1,330 yen and Kawasaki Kisen Kaisha Ltd (9107.T) climbed 4.5 percent to 807 yen. Sumitomo Mitsui Financial Group rose 0.3 percent to 679,000 yen, but other banks had largely erased early gains, with Mizuho Financial Group (8411.T) eking out a 0.4 percent rise to 461,000 yen.

Top lender Mitsubishi UFJ Financial Group (8306.T), in the midst of a bid for full control of a Californian bank, was flat. [ID:nT172438] (Editing by Rodney Joyce)