RTRS: Nikkei up but logs biggest annual drop ever in 2008
* Nikkei loses 42 pct in 2008, biggest annual fall ever
* Average climbs in December, first month of gains since May
* Oil rise on Mideast tension boosts resource-linked firms
* Exporters rise as dollar holds steady, some window-dressing
* 2009 seen tough, but market may have bottomed out already (Repeats to fix technical glitch)
By Elaine Lies
TOKYO, Dec 30 (Reuters) - Japan's Nikkei stock average fell 42 percent in 2008, the biggest loss in its 58-year history, though the benchmark gained 1.3 percent on its final half-day of trade.
Canon Inc (7751.T) and other exporters gained as the dollar rose slightly against the yen before falling back, while oil and gas field developer Inpex (1605.T) climbed as oil extended gains on concern that Israeli attacks on Gaza could disrupt Middle East crude oil supplies. [O/R] [ID:nLO226261]
Toyota Motor Co (7203.T) bucked the trend by slipping 1 percent, badly hit like the rest of the auto sector -- one of the Tokyo market's biggest fallers this year -- by the downturn in the global economy.
The Nikkei .N225 gained 112.39 points on Tuesday and rose 4 percent for December, its first positive month since May. But its annual losses were the biggest ever, surpassing the 38.7 percent tumble marked in 1990.
The broader Topix gained 0.5 percent on Tuesday to 859.24 but was also down 42 percent for the year.
Trade will resume on Jan 5.
Market players forecast a tough 2009 but said that hopes of further economic stimulus packages to stem the global economic downturn were providing some lift.
"Everyone's pinning their hopes on economic stimulus policies by the United States and possibly China, which is keeping the market supported for now," said Tomomi Yamashita, a fund manager at Shinkin Asset Management.
"But people aren't watching things like company results as closely as they should be. We can't say for sure that the market's bottomed out until we see these next spring."
In one possible sign of things to come, shares of Sharp Corp (6753.T) edged down 0.3 percent to 636 yen after the Nikkei business daily said the consumer electronics maker will book an extraordinary loss of more than 50 billion yen ($555 million) for the year to March 31, largely due to an impairment loss on its stake in Pioneer Corp
