* Nikkei try for 10,400 seen as key to stronger rebound
* Exporters rise on weaker yen
* Volume sinks to 1.52 bln shares, lowest since January
By Elaine Lies
TOKYO, Sept 7 (Reuters) - Japan's Nikkei stock average climbed 1.3 percent on Monday as exporters such as Canon Inc rose, with investors focusing on the bright side of mixed U.S. jobs data and as the yen retreated against the dollar.
Advantest Corp and other chip-related shares gained, buoyed by broad buying of their U.S. peers after Intel Corp's chief executive said ageing personal computers and Microsoft's launch of Windows 7 will prompt companies to start spending on PCs next year.
But the benchmark Nikkei was trapped in a narrow 52-point range with investors reluctant to trade as U.S. markets will be closed on Monday for a holiday and ahead of the settlement of Nikkei futures and options on Friday.
"Investors welcomed a rise in U.S. shares following monthly employment data and the yen's weakness," said Toshiyuki Kanayama, market analyst at Monex Inc.
"Gains were limited, however, as people don't want to chase prices higher due to a U.S. holiday today."
The benchmark Nikkei rose 133.83 points to 10,320.94 after hitting a five-week closing low on Friday.
The Nikkei lost 3.3 percent last week, and market players said recovering to where its 25-day moving average comes in, currently around 10,400, will be crucial for any further recovery. It hit a high of 10,676 on August 31.
The broader Topix advanced 1 percent to 944.60.
The Nikkei was also helped by gains in Shanghai shares, which investors had been eyeing after China eased inbound investment rules on Friday. "There are expectations of a lot more investment in China, and if Asian markets recover, so does the Nikkei," said Noritsugu Hirakawa, a strategist at Okasan Securities. China announced new draft rules on Friday on inbound portfolio investments, increasing the amount some institutions can invest in the country's stock markets.
U.S. job losses were the smallest in a year last month, coming in below forecasts at 216,000. But the unemployment rate rose to 9.7 percent from 9.4 percent the month before, the highest in 26 years and above expectations.
LIKELY FINANCE MINISTER SEEN SAFE CHOICE
Media reports that Hirohisa Fujii, a former finance minister, is likely to be picked for the same post in the new Japanese government led by Prime minister-elect Yukio Hatoyama also helped provide some comfort for investors, Monex's Kanayama said.
Fujii, a veteran lawmaker with conservative roots, served as finance minister briefly in the early 1990s.
Trade slowed on the Tokyo exchange's first section, with 1.52 billion shares changing hands, compared with last week's daily average of 1.89 billion. Monday's volume was the lowest since January.
Turnover was 1.05 trillion yen for the Tokyo Stock Exchange's first section, the lowest since July 17.
The dollar edged up 0.3 percent to 93.20 yen. Investors fret about a strong yen because it eats into exporter profits when repatriated.
Canon rose 2.3 percent to 3,550 yen, Sony Corp gained 2.7 percent to 2,490 yen. Advantest, a maker of chip-testing equipment, rose 2.2 percent to 2,325 yen, TDK Corp gained 2.8 percent to 5,450 yen and Tokyo Electron rose 1.6 percent to 5,000 yen.
Tokyo Dome Corp fell 1.1 percent to 273 yen after the operator of a baseball stadium and amusement facility said its first-half operating profit was likely to be 21 percent below its previous estimate, hit by weak sales at its hotel business.
Pixela Corp surged 37 percent or by its daily limit of 80 yen to 298 yen after the electronics maker said it planned to start selling TV tuners for terrestrial digital broadcasting through Aeon Co Ltd, Japan's second-largest retailer.
Advancing shares outnumbered declining ones, 862 to 644.