Nikkei rises on U.S. stocks, draws buying on dips

* Japan stocks oversold by some technical indicators

* Foreigners bought Japan stocks last week

* Buying before ex-dividend date helps-analyst

TOKYO, March 25 (Reuters) – The Nikkei share average rose on
Friday, helped by gains in U.S. stocks on optimism about
upcoming earnings reports, although investors will continue to
cautiously monitor developments at Japan’s troubled nuclear
power plant.

Analysts said the overall market may get a lift as investors
buy on dips, with some technical indicators showing that
Japanese stocks are heavily oversold.

The Nikkei is now trading about 6 percent below its 25-day
moving average at 10,115.40.

“Also, more than 60 percent of stocks on the Tokyo stock
exchange’s main board are trading below their book value, so
it’s time to buy back shares while watching problems at the
nuclear plant carefully,” said Hiroichi Nishi, general manager
at Nikko Cordial Securities.

Foreign investors bought a net 891.0 billion yen ($11
billion) of Japanese stocks last week, capital flows data from
Japan’s Ministry of Finance showed on Friday.

Some analysts said that foreign buying may continue before
the ex-dividend date on March 28.

The benchmark Nikkei average rose 0.9
percent, or 81.42 points, to 9,516.43. The broader Topix gained
0.5 percent to 858.07. The Nikkei is expected to trade between
9450 and 9650 on Friday, analysts said.

“There was selling pressure around the 9,500-mark yesterday,
but we may see the index top this level, supported by buying by
investors who want dividends,” said Hideyuki Okoshi, general
manager at Chibagin Securities.

Construction equipment makers were higher on expectations of
reconstruction-related demand as well as higher resource prices.
Komatsu Ltd rose 4.1 percent to 2,780 yen and Hitachi
Construction gained 0.7 percent to 2,049 yen.

Shares in food processor Nichirei jumped 4.8
percent to 352 yen after the Nikkei business daily reported it
would join forces with the Itochu group in the
frozen-food business, taking on most of the lost production at a
tsunami-damaged factory operated by an Itochu subsidiary in
northern Japan.

($1 = 80.985 Japanese Yen)

(Reporting by Ayai Tomisawa; Additional reporting by Antoni
Slodkowski; Editing by Edmund Klamann)

Nikkei rises on U.S. stocks, draws buying on dips