* Nikkei up 0.1 pct, brushes highest level since Dec. 18
* Profit taking caps market after recent sharp gains
By Shinichi Saoshiro
TOKYO, Feb 14 (Reuters) - Japan’s Nikkei share average rose for the third straight session and touched a two-month high on Thursday, lifted by a firmer Wall Street lead and a softer yen, which supported exporter stocks.
The Nikkei was up 0.1 percent at 21,166.36 as of 0204 GMT after rising to 21,235.62, its highest since Dec. 18.
The advance by the Nikkei was slowed by profit taking, which emerged after the index rose nearly 4 percent in the previous two days amid expectations for reduced U.S.-China trade tensions and Washington avoiding another government shutdown.
“It’s quite natural for sellers to emerge after two days of big gains. But the market is holding up well in the face of profit taking,” said Yoshinori Ogawa, senior strategist at Okasan Securities.
“The earnings seasons in both the United States and Japan are coming to an end, and there is relief that most of the corporate results were void of major surprises.”
Exporters rose as the yen weakened to a seven-week low versus the dollar, with Honda Motor Co adding 0.7 percent, Komatsu gaining 0.5 percent and Tokyo Electron rising 1.4 percent.
Index heavyweight Fast Retailing advanced 0.9 percent.
Asics Corp fell more than 6 percent after the sporting goods maker posted a net loss of 20.3 billion yen ($182 million) for the year through December 2018 amid weak sales in the United States and Australia.
Furniture retailer Otsuka Kagu Ltd slumped 13 percent after it said it was exploring options to bolster its finances, including through capital alliances. Otsuka Kagu added that it was in talks with several firms but that nothing had been decided.
Of the Tokyo Stock Exchange’s (TSE) 33 sub-indexes, 20 were in positive territory, led by construction. Mining led the losing shares.
The broader Topix was up 0.04 percent at 1,590.03.
$1 = 111.0100 yen Editing by Sam Holmes