Japan's Nikkei average climbed 1.3 percent on Friday, with chip stocks surging after reassuring comments from Intel Corp (INTC.O) and as a weaker yen and optimism about a fresh U.S. stimulus package lifted sentiment. Toyota Motor Corp (7203.T), the world's largest car maker, rose after it said would cut production at several North American plants over the next few months in a bid to cut its vehicle inventory in half. But Hitachi Ltd (6501.T), Japan's biggest electronics maker, edged lower as it became the latest blue-chip firm to be beset with losses. Sources said it would likely post an annual net loss of more than $1.1 billion. Hope that steps will be taken for the U.S. economy, including having the U.S. government give more money to troubled banks, helped spark buying of the dollar against the yen and lifted U.S. shares which in turn triggered short-covering of exporters in Tokyo. "The question is whether you can really trust the rise in U.S. shares we saw yesterday," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities. "Certainly there are expectations that things will get better over the longer-term, but at this point things still look pretty dark, making it hard to push stocks higher." The benchmark Nikkei .N225 appeared headed for its second consecutive week of losses for the first time since mid-November. It has so far fallen some 8 percent this week, over 700 points. The Nikkei gained 101.62 points to 8,124.93. It fell to a one-month low on Thursday and briefly broke below 8,000. The broader Topix rose 1.2 percent to 805.53. Optimism that the U.S. government will act to prevent the recession from deepening, including the Senate's rejection of an attempt to block the remaining $350 billion from the financial bailout fund, offset news that Bank of America (BAC.N) was seeking more government aid. .N "The details of the new government's policies may help support a further rebound and could lead to real recovery, though we could see falls again next month on the poor economy," said Yutaka Miura, senior technical analyst at Shinko Securities. But investors continued to worry about banks, especially with Citigroup (C.N) due to announce more losses and lay out a strategic plan on Friday. CHIP EQUIPMENT MAKERS CLIMB Chip equipment makers rose after Intel Corp said it expects margins to bounce back to healthy levels in the second half, setting off a relief rally since investors had feared the company would slash revenue expectations for the first quarter. Tokyo Electron (8035.T) gained 5.7 percent to 3,040 yen and Sumco (3436.T) surged 8 percent to 1,209 yen. Advantest Corp (6857.T) rose 2.2 percent. Hitachi lost 0.9 percent to 341 percent. Among major exporters, Sony gained 2.2 percent to 2,025 yen and Canon Inc (7751.T) edged up 0.4 percent to 2,780 yen. Toyota rose 2.8 percent to 2,920 yen and Honda Motor Corp (7267.T) climbed 2.9 percent to 1,916 yen. Trade was light, with 836 million shares changing hands on the Tokyo exchange's first section compared to last week's morning average of 1.1 billion. Advancing shares outpaced declining ones by more than 2 to 1.

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