TOKYO, Nov 17 (Reuters) - Japan's Nikkei average rose 2.1 percent in volatile trade on Monday as buying by public pension funds helped boost share prices. Amid the global economic turmoil, so-called defensive stocks such as drugmakers including Takeda Pharmaceutical Co (4502.T: Quote, Profile, Research, Stock Buzz) gained, helping to buoy the market. But major real estate firms plunged, with Japan's top property company Mitsui Fudosan Co (8801.T: Quote, Profile, Research, Stock Buzz) down nearly 5 percent, after the Nikkei business daily said its survey found rent charges for new office buildings in Tokyo had declined for the first time in six years. "Public pension funds have been buying shares when the Nikkei nears 8,000. That is behind today's rebound," said a stock analyst at a Japanese securities firm. The market fell in early trade, hurt by a sell-off after data showed Japan's economy was in recession, with the Nikkei falling near the psychologically important 8,000 level. The benchmark Nikkei slid nearly 3 percent earlier as investors came back from the weekend to find Japan's economy shrank 0.1 percent in the third quarter, lagging market expectations for anaemic growth of 0.1 percent. [ID:nT120174] The contraction confirmed that the global financial crisis has sabotaged growth in yet another major economy, with the euro zone already in recession, using the most common definition of two consecutive quarters of contraction. [ID:nLE536930] Takahiko Murai, general manager of equities at Nozomi Securities, said he worried more about the outlook going forward as Japan depended heavily on overseas demand for its exports. "We have no factors to expect the GDP figures will be revised up later as a deterioration in U.S. consumer spending is happening really fast, and a resulting firmer yen could further damage Japan's economic outlook," he said. The benchmark Nikkei .N225 added 1.83 points to 8,617.14, while the broader Topix .TOPX climbed 1.23 percent to 857.35. Governments from Washington to Beijing agreed on Saturday to a host of fiscal and monetary steps to rescue the global economy but it was left to individual governments to tailor their response to their particular circumstances and troubled industries, leaving markets unimpressed. [ID:nG7G8] Drugmakers gained, with Takeda rising 4.1 percent to 4,880 yen, while Eisai Co (4523.T: Quote, Profile, Research, Stock Buzz) added 5.2 percent to 3,460 yen. But shares of Mitsui Fudosan sank 3.7 percent to 1,405 yen, while Mitsubishi Estate Co (8802.T: Quote, Profile, Research, Stock Buzz) shed 4.0 percent at 1,417 yen. (Reporting by Rika Otsuka; Editing by Michael Watson)

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