TOKYO, Nov 14 (Reuters) - The Nikkei average gained 3.4 percent on Friday, poised to snap a three-day losing run, as a rally in U.S. stocks triggered short-covering, with investors picking up beaten-down shares such as Sony Corp (6758.T: Quote, Profile, Research, Stock Buzz). But the market trimmed earlier gains, after the benchmark rose more than 5 percent in morning trade, as the yen edged up against the dollar and U.S. stock futures SPc1 remained in negative territory. "The market rose on short-covering after falling sharply yesterday, but investors started closing positions ahead of the weekend," said Yutaka Miura, a senior technical analyst at Shinko Securities. "Investor hopes that some sort of measures may come out of the (G20) summit are supporting the market, but it's not something that can spark active buying now." Leaders of the Group of 20 developed and emerging nations gather in Washington on Friday and Saturday to discuss steps to address the financial crisis. [ID:nG7G8] As of 0421 GMT, the benchmark Nikkei average .N225 had added 282.69 points to 8,521.33, on its way to ending a three-day losing streak in which it lost more than 9 percent. The broader Topix index .TOPX climbed 1.7 percent to 852.04. The dollar fell 0.6 percent to 97.15 yen from 98.10 yen in early trade. Despite the day's gains, the outlook for the Tokyo share market remained clouded by concerns about a global recession and the turmoil and volatility in financial markets. "People are still taking a wait-and-see approach," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management Co Ltd. "U.S. shares have been very volatile, moving 1,000 points in a day, which is abnormal. This is not a normal situation, and so there are concerns that come next week there could be another decline." U.S. stocks surged on Thursday and broke a three-day losing streak after the S&P 500 and Nasdaq touched new five-year lows earlier in the session, prompting investors to put aside worries about the flagging economy and step in to hunt for bargains. [.N] EXPORTERS REBOUND Investors picked up beaten-down shares such as exporters. Sony jumped 5 percent to 2,100 yen, while industrial robot maker Fanuc Ltd (6954.T: Quote, Profile, Research, Stock Buzz) shot up 7.3 percent to 5,740 yen to become the top positive contributor to the Nikkei 225. Honda Motor (7267.T: Quote, Profile, Research, Stock Buzz) gained 4.2 percent to 2,130 yen. Toyota Motor (7203.T: Quote, Profile, Research, Stock Buzz) added 2.3 percent to 3,150 yen after the Nikkei business daily reported Toyota, facing a deep slump in the U.S. auto market, is considering postponing the start of production at a plant it is building in Mississippi until 2011 or later. [ID:nT271517] A Toyota spokesman said nothing had been decided. Among other notable stocks, Kubota Corp (6326.T: Quote, Profile, Research, Stock Buzz) climbed 7.9 percent to 559 yen after Nomura Securities lifted its rating on the stock to "buy" from "neutral", saying the company's earnings are likely to remain firm through March 2010. Shares of Nintendo Co (7974.OS: Quote, Profile, Research, Stock Buzz) jumped 5.4 percent to 30,100 yen after the Japanese video game maker said it sold 803,210 Wii video game consoles in the United States in October, continuing its lead with the country's best-selling video game console. [ID:nN13388775] But Isetan Mitsukoshi Holdings (3099.T: Quote, Profile, Research, Stock Buzz) fell 1.7 percent to 817 yen after Japan's largest department store operator cut its annual profit outlook and said it will slash prices as it braces for an economic slump it reckons could last two years. [ID:nT242117] (Reporting by Aiko Hayashi; Editing by Chris Gallagher)

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