Nikkei rallies as Fed rate cut hopes lift cyclical stocks; Fast Retailing drops

* All of Topix's 33 subsectors in positive territory
* Nikkei posts biggest daily gain in 2-1/2 months
* Exporters, banks soar
* Fast Retailing falls on weak same-store sales at Uniqlo

By Ayai Tomisawa
TOKYO, June 5 (Reuters) - Japan's Nikkei rebounded sharply
on Wednesday thanks to a rally in U.S. stocks after Federal
Reserve Chairman Jerome Powell signalled a possible rate cut.
The Nikkei share average .N225 ended 1.8% higher at
20,776.10, posting the biggest daily percentage gain since March
26.
All of the Topix's 33 subsectors were in positive territory,
with the broader Topix .TOPX also jumping 2.1% to 1,530.08.
Powell said the central bank would act "as appropriate" to
address trade war risks a day after St. Louis Fed chief James
Bullard said a rate cut may be warranted soon. Powell said the
Fed was "closely monitoring the implications" of a trade dispute
that has disrupted global markets. Investors are buying back recently battered stocks such as
exporters and financial firms, analysts said, though
developments in the U.S.-China trade war will have the ultimate
say in future price moves.
"The market knows that even if the Fed cuts rates, global
trade tensions won't be resolved easily," said Yutaka Miura, a
senior technical analyst at Mizuho Securities, adding that the
Fed's message was positive for investors.
Machinery makers and automakers regained some lost ground,
with Fanuc Corp 6954.T up 3%, Yaskawa Electric Corp 6506.T
jumping 4.3%, Advantest Corp 6857.T rising 3.1% and Toyota
Motor Corp 7203.T advancing 2.5%.
Banks and insurers, which hunt for higher yielding products
such as foreign bonds, also attracted buyers. Mitsubishi UFJ
Financial Group 8306.T rose 1.5% and Dai-ichi Life Holdings
8750.T rallied 2.6%.
SoftBank Group Corp 9984.T jumped 3% after the company
said on Tuesday it expects to book around 1.2 trillion yen
($11.12 billion) in pre-tax profit on the sale of shares in
China's Alibaba Group Holding Ltd BABA.N . Fast Retailing 9983.T underperformed the market, falling
1% after the company said same-store sales at its Uniqlo
clothing outlets in Japan fell 1.6% in May on the year.


(Editing by Shri Navaratnam and Darren Schuettler)