TOKYO (Reuters) - Japan's Nikkei share average edged higher on Monday as gains in index heavyweights Fast Retailing Co Ltd (9983.T) and Advantest Corp (6857.T) erased losses caused by investors booking profits in export-focused firms after weaker-than-expected Chinese trade data.
The Nikkei ended 0.1 percent higher at 9,533.75, after trading as high as 9,584.46, its best level since late April.
Fast Retailing, the operator of Uniqlo casual clothing chain, was the top weighted gainer, advancing 1.5 percent after Nomura Securities lifted its price target.
Advantest Corp (6857.T) climbed 3.9 percent and was the second-top weighted gainer on the index after Bloomberg news quoted the chip tester maker's President Haruo Matsuno as saying that he expected new orders to rise 20 percent in the October-December quarter from the previous three months.
A 10-percent rally in the Nikkei over the past 3-1/2 weeks was, however, showing some signs of fatigue, as investors pocketed gains in some of the exporters, with Canon Inc (7751.T), TDK Corp (6762.T), Honda Motor Co (7267.T) and Nissan Motor Co (7201.T) down between 0.6 and 3.1 percent.
China's exports rose in November at a much weaker pace than expected and imports were flat, taking some shine off weekend data that had suggested the world's second-largest economy was regaining momentum.
"A good deal has been discounted in the price. From a seasonality factor, a lot of the investors will go to the sidelines and take a wait-and-see attitude, so we will have a thin volume market for the next couple of weeks." said Yasuo Sakuma, portfolio manager at Bayview Asset Management. "The market will move in a very narrow range ... say 9,300 to 9,600."
Sakuma was among those who cashed in on recent gains in the Nikkei as the yen has weakened after calls by Shinzo Abe, the leader of the main opposition which is expected to win a December 16 general election, for the Bank of Japan to embark on "unlimited easing" and set an inflation target of 2 percent.
"I bought high-beta sectors like securities and materials. Fortunately those cyclical sectors posted sharp rally through November. I took profit on them. We have increased our cash position in the past couple of days," he said.
The broader Topx index slipped 0.2 percent to 788.48, with 1.94 billion shares changing hands, down from Friday's 2.09 billion but slightly ahead of last week's average of 1.91 billion.
Stefan Worrall, director of equity cash sales at Credit Suisse in Tokyo, said some in the market were concerned that a lot of the positive outcome had been priced in to the market and it needed further positive news to push the index higher.
Sharp Corp (6753.T) sank 5.6 percent after rallying nearly 26 percent on short-covering after U.S. chipmaker Qualcomm Inc (QCOM.O) said it will invest as much as $120 million in the struggling TV maker.
Short-selling interest in Sharp has fallen lately although it still remained high, with 91.15 percent of its stock that is available to be borrowed out on loan as of December 6, down from 93.46 percent on November 30, according to data provider Markit.
Ailing chipmaker Renesas Electronics Corp (6723.T), climbed 3 percent after the Nikkei business daily reported the Japanese company decided to accept capital investment from the government-backed Innovation Network Corp of Japan and other manufacturers, including Toyota Motor Corp (7203.T).
Japanese equities carry a 12-month forward price-to-earnings ratio of 12.1, more expensive then the pan-European STOXX Europe 600's 11.1 but cheaper than the U.S. S&P 500's 12.5, data from Thomson Reuters Datastream showed.
The benchmark Nikkei is up 12.8 percent this year, in line with a 12.8 percent rise in the S&P 500 but lagging a 14.2 percent gain in the STOXX Europe 600.
Editing by Sanjeev Miglani