* Daiwa Securities falls after announcing share sale
* Stock market takes industrial output data in stride
* Investors await more economic data later this week
By Masayuki Kitano
TOKYO, June 29 (Reuters) - Japan's Nikkei average rose on Monday supported by hopes that data due later this week may point to an improvement in the global economy, while Daiwa Securities tumbled after announcing a $2.5 billion share sale.
Nippon Electric Glass rose after the maker of LCD glass lifted its estimate for the April-June first quarter, expecting a 10 billion yen ($105 million) operating profit -- double the top of the forecast range it had given earlier.
The Nikkei did not draw much strength from data showing that industrial output rose by 5.9 percent in May, as it merely underscored the view that the worst of Japan's economic slump may be over, market analysts said.
But they said the data was not a big negative for Tokyo shares as it showed industrial output was continuing to improve.
Tsutomu Yamada, a market analyst for Kabu.com Securities, said Tokyo shares may be drawing support since key data due later this week is expected to point to improving economic conditions.
"It's hard to sell since the economic data seems likely to come in on the firm side," Yamada said.
The Bank of Japan's tankan quarterly survey due on Wednesday will likely show confidence at big manufacturers rebounding from a record low hit three months ago. The U.S. Institute for Supply Management's index of national factory activity, also due on Wednesday, is expected to rise to 44.5 in June compared to 42.8 in May. The Nikkei ended morning trade up 0.4 percent or 38.74 points at 9,916.13.
The broader Topix rose 0.2 percent to 929.05.
The Nikkei has taken a breather from a three-month rally that buoyed it to an eight-month intraday high of 10,170.82 earlier in June, but is still on track for its best quarter since 1995, having risen around 22 percent so far in the April-June quarter.
"Hopes for macroeconomic recovery remain strong, although there are also significant worries about the outlook," said Tomomi Yamashita, a fund manager for Shinkin Asset Management.
One risk would be if the yen were to strengthen sharply and that was to lead to concerns about corporate earnings, Yamashita said.
Daiwa Securities slid 12.3 percent to 586 yen after saying on Friday it would raise about $2.5 billion in its first share sale in 20 years as it looks to expand overseas and bolster its domestic retail operations.
Takeda Pharmaceutical fell 1.9 percent to 3,720 yen after Japan's largest drugmaker said its key diabetes drug failed to get approval from U.S. regulators.
U.S. approval for the drug candidate alogliptin, which has been positioned by Takeda as a successor to its top-selling drug Actos, may take until the end of the business year to March 2012, Takeda told Reuters over the weekend.
Nippon Electric Glass rose 1 percent to 1,065 yen.
Mizuho Securities kept its rating at "2", expecting the stock to outperform the market by 5-15 percent, but lifted its target price to 1,200 yen from 1,050 yen.
Elpida Memory Inc soared 5.9 percent to 1,077 yen after media reported that the Japanese PC chip maker is to receive financial support totalling about 200 billion yen from the government and public and private-sector banks. (Editing by Michael Watson)