Japan stocks rise as Honda, Sony get earnings lift

(Updates to midmorning)

TOKYO, Oct 26 (Reuters) - Japanese stocks rose on Friday, with Honda Motor Co (7267.T: Quote, Profile, Research, Stock Buzz) and Sony Corp (6758.T: Quote, Profile, Research, Stock Buzz) jumping after posting strong earnings.

Canon Inc (7751.T: Quote, Profile, Research, Stock Buzz) also rose. It posted a decline in quarterly profit but kept its full-year outlook on the back of strong demand for its digital cameras.

Still, strong gains by these blue chip were slow to translate into a big advance in the overall market as investors remained cautious ahead of more earnings to come, with the Nikkei average .N225 edging up 0.8 percent.

"Sony results are a surprise. But there is a concern about a slowdown in U.S. consumer spending. So, we cannot expect sustained growth in its share price," said Takahiko Murai, general manager of equities at Nozomi Securities.

"Overall, there's a chance exporters could cut their full-year outlook if the situation in the United States turns worse than expected."

As of 0102 GMT, the benchmark Nikkei was up 125.61 points at 16,409.78. The broader TOPIX index was up 1 percent at 1,563.33.

Honda jumped 6.2 percent to 3,940 yen after Japan's second-biggest automaker posted a forecast-beating 63 percent jump in quarterly earnings as strong sales of its new CR-V crossover made up for higher raw materials costs, and it raised its full-year net profit forecast on a lower tax rate. [ID:nSP249666]

Sony rose 6.9 percent to 5,460 yen after it reported a swing to a quarterly operating profit on Thursday on strong sales of personal computers and digital cameras, raising its full-year forecast by 2 percent.