Nikkei at 4-month closing high, led by exporters

(Adds details, trade volume)

By Aiko Hayashi

TOKYO, May 2 (Reuters) - Japan's Nikkei stock average rose more than 2 percent on Friday to its highest close in nearly four months, buoyed by exporters such as Advantest Corp (6857.T) on a softer yen and a rally on Wall Street amid growing optimism about the U.S. economy.

The benchmark Nikkei has now gained 20 percent since hitting a low for the year on March 17, handily outperforming a roughly 12 percent rise in the U.S. Standard & Poor's 500 Index .SPX and the pan-European FTSEEurofirst 300 index .FTEU3 during the same period.

Property firm Sumitomo Realty & Development Co (8830.T) shot up more than 7 percent after a newspaper reported its profits were likely to beat forecasts. Other real estate stocks also rose on the back of strong earnings, helped by demand for office space in Tokyo.

Bank shares tracked gains in their U.S. peers due to improved investor confidence a day after the Federal Reserve trimmed rates again and hinted at a pause in its recent campaign to lower borrowing costs.

On the negative side, Japan Tobacco Inc (2914.T) slid 4.1 percent to 490,000 yen after the world's third-largest cigarette maker forecast a 28 percent fall in profit this year due to an accounting change, its first drop in eight years. This prompted Goldman Sachs to remove the stock from its "conviction buy list" and lowered the target price. [ID:nT2944]

"Today's market is buoyed by a rally in the United States and a softer yen. But investors seem to have become too optimistic about the U.S. economy recently as jobs data later today is still expected to be poor," said Soichiro Monji, a chief strategist of the equity management department at Daiwa SB Investments.

"The Nikkei's 14,000 looks to be the ceiling for now. If it goes above that level, stocks are overbought under the current conditions."

The Nikkei average .N225 climbed 2.1 percent or 282.40 points to end at 14,049.26, its highest close since Jan. 11.

It rose 1.3 percent during the week, posting the seventh weekly gain this year. In April, the benchmark gained 10.6 percent, the biggest monthly percentage gain since July 1995, when it jumped 14.9 percent.

The broader TOPIX index added 2.3 percent or 31.29 points to 1,377.39.

Yusuke Sakai, manager of equities trading at Mizuho Securities, said the support line for the Nikkei looks to have risen to around 14,000 from the range between 13,500 and 14,000.

"The market has begun to see the 13,000 level as fairly cheap now," he said.

The three U.S. major indexes closed at the highest level on Thursday since the first half of January as equities extended a rally started in mid-March on optimism that credit markets and the economy have begun to stabilise.

Traders will scrutinise the U.S. labour Department's April employment report due at 1230 GMT for more clues on how the U.S. economy is faring. Economists expect nonfarm payrolls USNFAR=ECI to have shed 80,000 jobs, in line with losses in the three previous months.