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Nikkei hits 2-1/2-mth high on U.S. recovery hopes

* Nikkei posts highest close since Jan. 9

* Exporters gain as U.S. data boosts hopes for economy

* Elpida soars 18 pct on share issue plan

* Investors start buying for next financial year

By Rika Otsuka

TOKYO, March 26 (Reuters) - Japan's Nikkei average rose 1.8 percent to hit a 2-1/2-month closing high on Thursday as exporters such as Sony Corp 6758.T gained after unexpectedly strong U.S. economic data sparked hopes for an economic recovery.

Elpida Memory Inc 6665.T soared 18 percent to 657 yen after it said it would raise 46 billion yen ($470.6 million), aiming to shore up its balance sheet and avoid breaching debt covenants. [ID:nT341931]

Adding to the market’s bullish tone, a U.S. senior lawmaker said on Wednesday that an Obama administration task force is likely to recommend more aid for struggling U.S. automakers. [ID:nN25442518]

“Japanese stocks were boosted by speculation U.S. stocks will rise later in the day on expectations U.S. automakers could receive further aid,” said Masayoshi Yano, a senior market analyst at Meiwa Securities. “Investors are turning a little more optimistic about the U.S. economy, also on economic data.”

The benchmark Nikkei .N225 ended up 156.34 points at 8,636.33, its highest close since Jan. 9. The Nikkei has jumped nearly 1,600 points or over 22 percent from a 26-year closing low hit near 7,000 on March 10.

The broader Topix .TOPX gained 1 percent to 826.81.

The Dow Jones industrial average .DJI gained 1.2 percent on Wednesday as unexpectedly strong housing and durable goods data fuelled hopes the economy is finally on the mend.

U.S. new home sales rose at their fastest pace in 10 months in February, adding to recent data showing signs of hope in the battered housing sector.

Wednesday was the last day for investors to buy many Japanese stocks and still get dividends on them for the financial year ending this month. This ex-dividend impact may be lopping about 70-80 points off the Nikkei average .N225, market analysts said.

The Nikkei was dragged down by the dividend factor in early trade then quickly recovered, underscoring the firmness in the market. That prompted speculators to cover short positions, traders said.

“Given the impact from ex-dividend, the rise in stocks was better than it appeared to be,” said Fujio Ando, senior managing director of Chibagin Asset Management. “Share are likely to extend their rally until mid-April when corporate earnings figures start to come out, with the Nikkei possibly trying the 9,000 level soon.”

Some institutional investors started to buy stocks for the new business year as Thursday’s trades will be settled on April 1, when Japan’s new fiscal year starts.

Trade was light on the Tokyo exchange’s first section, with 1.9 billion shares changing hands, compared with last week’s daily average of 2.2 billion.

Advancing stocks outnumbered declining ones by five to three.

EXPORTERS LEAD

Among exporters, Sony jumped 6.8 percent to 2,215 yen and Canon Inc 7751.T climbed 3.5 percent to 2,965 yen. Advantest Corp 6857.T gained 4 percent to 1,592 yen.

Fuji Electric Holdings Co 6504.T rose after the Nikkei business daily said on Thursday that Fuji and TDK Corp 6762.T planned to merge their uninterruptible power supply operations in October, forming a venture larger than the UPS operations of current market leader Mitsubishi Electric Corp 6503.T. [ID:nN25434596]

Fuji Electric advanced 6 percent to 124 yen, while TDK was up 0.5 percent at 3,990 yen.

Banks rose, with Mitsubishi UFJ Financial Group 8306.T, Japan's top lender, gaining 1.5 percent to 540 yen and Sumitomo Mitsui Financial Group 8316.T advancing 2.1 percent to 3,960 yen.

But drugmakers Takeda Pharmaceutical Co 4502.T lost 3.5 percent to 3,640 yen and Eisai Co 4523.T sank 2.9 percent to 3,040 yen.

Among stocks considered to have stable dividend yields, Tokyo Electric Power 9501.T fell 1.3 percent to 2,585 yen, after gaining the previous day.

Credit Saison Co 8253.T soared 7.8 percent to 970 yen after the consumer lender unveiled a plan to restructure its affiliate Atrium 8993.T, an ailing real estate developer.

Atrium plunged 23 percent to 133 yen as Credit Saison said it would make Atrium a subsidiary, exchanging 0.13 Credit Saison share for one Atrium share. (Additional reporting by Aiko Hayashi; Editing by Michael Watson)

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