* Nikkei lifted as Wall St extends gains on upbeat earnings
* Concern over domestic politics checks market's advance
* Nissan up on hybrid car report, NEC sinks on dilution worry
By Shinichi Saoshiro
TOKYO, July 17 (Reuters) - Japan's Nikkei average rose 0.4 percent on Friday after Wall Street climbed for a fourth day following strong earnings results at JPMorgan, though gains were limited due to concern over domestic politics.
Nissan Motor climbed 2.2 percent after the Nikkei business daily said Japan's third-largest automaker aims to develop its own hybrid technology for small and midsize cars and will launch a vehicle using that system in Japan in 2011.
But electronics conglomerate NEC Corp sank 11.1 percent after news that it is considering raising $2.1 billion in capital.
The market got a boost following another rise in U.S. stocks the previous day, but the advance was kept in check by worries about Japanese politics amid thin trade before a long weekend in Japan.
"Many investors want to lighten their positions before the three-day weekend, as political turmoil could deepen during the break," said Masayoshi Okamoto, head of dealing at Jujiya Securities.
Political uncertainty has lingered since the Nikkei hit an eight-week low of 9,050.33 on Monday, when embattled Prime Minister Taro Aso sparked chaos in the long-ruling Liberal Democratic Party when he announced plans for an Aug. 30 election despite grim prospects for the LDP.
"Many closely watched earnings results from the United States have been better than expected, but the political situation at home is preventing the market from fully embracing the upbeat results," Okamoto said.
The benchmark Nikkei ended the morning session up 39.34 points at 9,383.50, on track for a fourth straight day of gains after snapping a nine-day slide on Monday. As of the midday break the Nikkei had gained 1 percent on the week.
The broader Topix gained 0.4 percent to 875.96.
NISSAN ADVANCES, NEC SINKS
Sekisui House advanced 2.2 percent to 851 yen after news the home builder plans to launch a residential property development in Australia that will generate 200 billion yen ($2.1 billion) in sales over the next 10 years.
Elpida Memory Inc edged up 0.4 percent to 971 yen after the Nikkei reported that the price of DRAM chips, a mainstay product for Elpida, rose above $1 for the first time in 7-½ months.
Nissan advanced 2.2 percent to 567 yen, while NEC lost 11.1 percent to 281 yen.
Plant engineering firm JGC Corp rose 2.3 percent to 1,460 yen, extending gains from Thursday after state-owned Abu Dhabi Gas Industries Ltd (Gasco) said it had awarded JGC and another company with contracts worth a total of about $9 billion for major gas projects in the Gulf emirate.
Among decliners, Hitachi Construction Machinery slid 3.2 percent to 1,447 yen after the Nikkei business daily said it would likely book a roughly 5 billion yen ($53 million) group operating loss for the April-June quarter.
Trade was thin on the Tokyo exchange's first section, with 798 million shares changing hands, compared with last week's morning average of 1 billion.
Advancing stocks outnumbered declining ones, 942 to 568. (Editing by Chris Gallagher)