TOKYO, May 2 (Reuters) - Japan's Nikkei average jumped above 10,000 for the first time since mid-March on Monday on optimism that Wall Street shares would rally further later in the day after U.S. officials said Al Qaeda leader Osama bin Laden had been killed.
The Nikkei hit a post-March 11 earthquake high of 10,017.47 shortly after the start of the afternoon trade at 0330 GMT, but the market turned nervous about piling on large positions with Japan's "Golden Week" holiday continuing on Tuesday, traders said.
"Japanese shares rose after seeing solid gains in U.S. stock futures on views that one geopolitical risk has been removed after the death of bin Laden. Japanese shares could advance further should U.S. shares extend their gains tonight," said Hideyuki Ishiguro, a supervisor at Okasan Securities.
"But the market will be nervous about taking more positions in the middle of the holiday season. Also there are still many uncertainties in Japan after the earthquake, so investors will be cautious about taking large positions above 10,000."
In mid-afternoon trade the benchmark Nikkei average was up 1.5 percent at 9,995.66, while the broader Topix had risen 1.5 percent to 864.64.
The Nikkei reached the 10,000-level for the first time since March 14, just after the massive earthquake and tsunami that devastated the country's northeast coast and sent stocks tumbling.
The Nikkei drifted down from the high as the market lacked energy as Japan is in the middle of its Golden Week holidays, with markets closed last Friday and only open on Monday and Friday this week.
President Barack Obama announced on Monday that bin Laden was killed on Sunday in a firefight with U.S. forces in Pakistan and that his body was recovered. [ID:nN01168438]
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