The Nikkei rose 0.68 percent on Wednesday as Canon Inc. (7751.T) and other exporters climbed after U.S. stocks posted their biggest gains in a year on expectations the U.S. interest rate-hike cycle may be near an end.

Fujitsu Ltd. (6702.T) climbed after revising up its earnings forecasts while strong earnings from U.S. firms like Texas Instruments Inc. (NYSE:TXN - news) and Yahoo Inc. (Nasdaq:YHOO - news) helped other Japanese technology stocks such as Kyocera Corp (6971.T).

Yutaka Shiraki, a senior strategist at Mitsubishi UFJ Securities Co. Ltd., said the end of U.S. interest rate hikes could be a good sign from the major Japanese trading partner.

This may indicate that the U.S. economy is heading for a soft landing on steady growth. It could be a healthy economic sign, he said.

But Andrew Millward, fund manager a Henderson Global Investors Japan K.K, said it's too early to say how the U.S. economy will do and what the impact on the stock market will be.

I'm not sure that the end of interest rate cycle tightening is necessarily a good thing. Historically the timing of the last interest rate tightening is usually the top of the market, he said. It is a lot early to say at the moment.

The Nikkei (^N225 - news) ended up 117.26 points at 17,350.12. The broader TOPIX index (^TOPX - news) rose 0.32 percent to 1,747.32.

The minutes of the U.S. Federal Reserve's latest meeting suggested that most participants saw the Fed's long tightening cycle coming to an end, and that some members were concerned about too much tightening.

Some analysts said this may help keep not only U.S. but also Japanese long-term interest rates from rising further, making stocks attractive for investors. The yield on Japanese 10-year government bonds retreated after surging to 2 percent on Tuesday for the first time since August 1999.

Fujitsu rose 1.3 percent to 967 yen after it said it likely beat its net profit target for the year just ended by 36 percent, due to healthy sales of hard disk drives and mobile phones.

Other mobile phone-related firms gained ground on strong earnings from U.S. Texas Instruments Inc., with Kyocera adding 3.1 percent to 11,170 yen, and Murata Manufacturing Co. Ltd. (6981.OS) putting on 0.9 percent to 8,070 yen in Osaka.

Expectations for strong profit growth lifted some technology shares ahead of earnings results next week. Consumer electronics maker Sony Corp. (6758.T) rose 2.1 percent to 5,790 yen.

Elpida Memory Inc. (6665.T) surged 4.1 percent to 4,830 yen after the world's fifth-largest DRAM chip maker said its earnings on an operating basis looked brighter than it had previously expected for the year that ended in March.

Meanwhile, Aiful Corp. (8515.T) and other consumer loan companies fell after a government panel reviewing money-lending laws appeared to favor lowering the maximum interest rate allowed on consumer loans. Aiful slipped 4.3 percent to 6,680 yen.

HOPES FOR EARNINGS GROWTH

Full-year earnings announcements from major companies kick off next week and analysts said expectations are high.

Double-digit growth is certainly achievable in the environment where you've got real GDP growth of 3 percent plus inflation of maybe 1 percent ... you should get 4 percent sales growth plus double digit operating profit growth, said Millward of Henderson Global Investors Japan K.K.

Merrill Lynch equity strategist Masatoshi Kikuchi said corporate profit growth could reach 12 to 13 percent and the Nikkei could rise as high as 19,500 by the end of this year or early next year.

Japanese companies have strengthened their balance sheets and are less susceptible to rises in interest rates, even the sectors that are regarded as interest rate-sensitive. I expect the impact of rate hikes on stock prices to be limited, he said.

After the market closed, Nissan Motor Co. Ltd. (7201.T) said that it expects its parent net profit to have more than doubled to 240.59 billion yen ($2.1 billion) in the fiscal year that ended in March. That compared with 102.42 billion yen a year ago.

Nissan ended up 0.4 percent at 1,394 yen.

Trade volume picked up with 1.69 billion shares changing hands on Wednesday, compared with 1.59 billion shares on the previous session. Decliners outnumbered advancers 805 to 768.

Nikkei 225 Japan