By Elaine Lies TOKYO (Reuters) - Japan's Nikkei average jumped 4.7 percent on Monday on hope a lifeline may still be given to struggling U.S. automakers, with a stronger dollar against the yen boosting exporters such as Canon Inc (7751.T: Quote, Profile, Research, Stock Buzz). Honda Motor Co (7267.T: Quote, Profile, Research, Stock Buzz) and other automakers climbed after the White House said on Friday the administration would consider using part of the Treasury's $700 billion bailout package for financial institutions to keep the Big 3 automakers afloat after an autos bailout bill failed in the Senate. These expectations helped the market shrug off the Bank of Japan's tankan corporate survey, which showed that business sentiment has suffered its sharpest fall since 1974 to hit a nearly seven-year low. Market players said the results had been mostly as expected and already factored in. "The tankan was bad but this has mostly been factored in already, it's not today's news," said Masayoshi Okamoto, head of dealing at Jujiya Securities. "Today's trade is based on the U.S. auto situation. Something needs to be done to save them, not just for Japan but for the world." Hope about the potential lifeline for the automakers, including giant General Motors (GM.N: Quote, Profile, Research, Stock Buzz), helped boost U.S. shares on Friday, though the White House later said there would be no word on the bailout for a while. But even this was enough to lift Tokyo shares despite the poor tankan numbers. The headline index for big manufacturers' sentiment fell to a nearly seven-year low of minus 24, down from minus 3 in the previous survey in September and just below economists' median forecast of minus 23. "The tankan was very bad and the forecast especially very bad, much worse than expected. Stocks should not be rising," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities. "But relief over the auto bailout lifted Wall Street, and this is lifting the Nikkei as well. That's the main thing." The benchmark Nikkei .N225 gained 390.13 points to 8,626.00 after falling 5.56 percent on Friday after the auto bailout bill fell apart in the U.S. Senate. The broader Topix .TOPX gained 3.9 percent to 845.21. YEN RETREAT, EXPORTER ADVANCE The dollar climbed above 91 yen in morning trade, off a 13-year low of 88.10 yen hit on Friday, though it fell back slightly by midday to 90.90 yen. Exporters gained as a result, led by automakers up both on the stronger dollar as well as the bailout hopes. A strong yen eats into exporters' profits when repatriated. Honda (7267.T: Quote, Profile, Research, Stock Buzz) rose 7.8 percent to 2,070 yen and Toyota Motor Co (7203.T: Quote, Profile, Research, Stock Buzz) gained 7.4 percent to 2,965 yen. Nissan Motor Co (7201.T: Quote, Profile, Research, Stock Buzz) rose 6.5 percent to 328 yen. Toyota also shrugged off Japanese media reports on Saturday that it is likely to further cut its earnings forecasts and report an operating loss of about 100 billion yen ($1 billion) in the October-March period.

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