* Weaker yen drives shares in Toyota, Honda, Nissan higher
* Canon, Nidec sag after Hewlett-Packard warns on outlook
By Dominic Lau
TOKYO, Oct 4 (Reuters) - Japan's Nikkei share average snapped a four-session losing streak on Thursday as sentiment was boosted by a strong showing by the pro-business U.S. Republican candidate, Mitt Romney, in his first debate with President Barack Obama, dealers said.
"There is a certain school of people that have particular views on which candidate is better for the markets, specifically for the dollar ... It's probably an initial gut reaction to the presidential debate," a dealer at a European brokerage said.
A CNN/ORC snap poll said 67 percent of registered voters surveyed thought Romney won the debate at the University of Denver, compared with 25 percent for Obama.
advanced 0.9 percent to 8,824.59, but faced resistance at its 75-day moving average at 8,871.78, while U.S. S&P futures
rose 0.4 percent.
"It is really about the currency. Our currency guys are saying that some macro funds started buying risky currencies post the debate ... so who knows," said a senior trader at a U.S. bank. "I think the market is just looking for an excuse to go higher."
A weaker yen, which was quoted at 78.60 yen to the dollar after hitting a two-week low of 78.72, improved the appeal of Japanese exporters. Toyota Motor Corp
gained 3 percent, Nissan Motor Co
surged 5.1 percent and Honda Motor Co
climbed 3.1 percent.
The automakers have been battered lately on concerns over sputtering global growth and sluggish demand from China amid rising anti-Japanese sentiment over a territorial dispute.
"Although the Big Three all strike us as undervalued from a medium-term perspective, our preference over the next three months is for Honda Motor, followed by Toyota Motor, followed by Nissan Motor," Nomura said in a note.
The benchmark Nikkei is up 4.4 percent so far this year, trailing a 15.4 percent rise in the S&P 500
and a 11 percent gain in the pan-European STOXX Europe 600
Another trader at a European bank said there was a buy programme going into the morning session, which also helped push the index higher.
But Canon Inc dropped 2.2 percent on Thursday after its client Hewlett-Packard
warned of an unexpectedly steep earnings slide in 2013, with revenue set to fall in every business division except software.
sagged 4.4 percent after J.P. Morgan cut its rating on the maker of precision motors to 'neutral' from 'overweight' and on the back of Hewlett-Packard's outlook warning.
Other noticeable losers included Nikon Corp
, which shed 3.6 percent after the Nikkei business daily said its interim operating profit would drop 43 percent on the year to 35 billion yen ($445.69 million), signalling a slowdown in sales.
"Investors are backing out of tech shares, where profits are looking weaker and weaker," said Yasuo Sakuma, portfolio manager at Bayview Asset Management. "After companies went ex-dividend at the end of September there are precious few reasons to buy."
The latest quarterly earnings season will move into high gear in the next two to three weeks. Investors were disappointed with the previous quarterly earnings, when 54 percent of Nikkei companies reported results below analysts' expectations.
For this quarter's results, SmartEstimates from Thomson Reuters StarMine expects an average negative earnings surprise of 1.2 percent.
The broader Topix
rose 1.1 percent to 735,38, with nearly 1.64 billion shares changing hands, up from Wednesday's 1.4 billion and last week's average of 1.6 billion.
Market consensus is mixed over whether the Bank of Japan will ease monetary policy further after it concludes a two-day meeting on Friday, as it may be reluctant to expand its balance sheet after swelling it by 10 trillion yen last month, although its latest survey showed increasing pessimism about the domestic economy.
However, in the latest sign that the U.S. economy is getting back on its feet, data showed growth in the country's service sector in September, contrary to economists' expectations of a slight decrease. The private sector also added more jobs than anticipated last month, which bodes well, ahead of Friday's nonfarm payrolls data.
($1 = 78.5300 Japanese yen)
(Additional reporting by Sophie Knight; Editing by Sanjeev Miglani)
Keywords: MARKETS JAPAN STOCKS/