Nikkei at 4-1/2-yr high on U.S. data, weak yen; financials lead

* Sumitomo Mitsui jumps after saying to repay bailout funds

* Shiseido surges on reports that president to leave

* Automakers boosted by Citi target price hike - analyst

TOKYO, March 11 (Reuters) - The Nikkei share average hit a 4-1/2-year high on Monday morning as signs of recovery in the U.S. economy boosted investor sentiment and a weaker yen fuelled gains in financials and exporters. The Nikkei rose 0.9 percent to 12,396.55, a level not seen since just before the collapse of Lehman Brothers roiled global markets in September 2008. The Topix surged 2.2 percent to 1,042.41, its highest level since October 2008. The broader market's gains were underpinned by the yen slumping to more than 96 per dollar, its weakest since August 2009, after a strong U.S. jobs report on Friday. "While last week the Nikkei's gains were driven by Fast Retailing, today the broader Topix jumped after things turned out to be the best possible scenario over the weekend," said Naoki Fujiwara, chief fund manager at Shinkin Asset Management. Last week, the Nikkei marked its biggest weekly gain since December 2011, helped by index heavyweight Fast Retailing's gain of 24 percent. On Monday morning, the stock dropped 1.6 percent. Signs of a recovery in the U.S. labour market bolstered sentiment among investors in Japanese stocks, which are already riding a bullish streak on expectations of aggressive easing by the Bank of Japan under governor nominee Haruhiko Kuroda. "This time, the yen weakened not because of Japan but because of the United States, or the recovery in the U.S. economy. It's not something that foreign countries can criticise Japan for," said Fujiwara. Financials led the sectoral gainers. The securities sub-index jumped 5.4 percent, while the banking and real estate sectors advanced 5 percent and 4.9 percent respectively. Sumitomo Mitsui Trust Holdings Inc shot up 5.4 percent to a 4-1/2-year high after the bank said it would repay 200 billion yen ($2.1 billion) in public bailout money, ending more than a decade of partial government ownership.

Mizuho Financial Group Inc and Mitsubishi UFJ Financial Group Inc gained 4.4 and 5.6 percent respectively in heavy trade as the softer yen and government's reflationary policies were expected to stimulate demand for loans, traders said. "On a dollar basis, Japan is now significantly outperforming, and from that perspective it's reflecting the real recovery signs emerging globally for Japanese exports that go beyond the weaker yen," said Stefan Worrall, director of cash equities at Credit Suisse. Honda Motor Co Ltd, Nissan Motor Co Ltd and Yamaha Motor got an extra boost from Citi target price hikes, according to an analyst, rising between 2.9 and 4.7 percent. Sharp Corp was out of favour, however, falling 2.5 percent after the Asahi newspaper said Hon Hai Precision Industry Co Ltd would not invest in the troubled electronics maker before a March 26 deadline. Shiseido Co Ltd jumped 6.1 percent on media reports the president of Japan's largest cosmetics company will end an underwhelming reign that saw profits drop dramatically, with the current chairman taking his place. Gains in exporters, banks and real estate have largely led the Nikkei's 42 percent rally since mid-November, when Prime Minister Shinzo Abe stepped up the calls for aggressive monetary and fiscal policy that saw his party sweep to power in December. And while a softer yen has improved the fundamentals for Japanese companies, some wonder if the sharp gains have made stocks overpriced. "The Topix's 12-month forward price-to-earnings ratio is now 13.3, which implies that investors are pricing in a 50 to 60 percent increase in profits for companies, based on the weaker yen," said Masayuki Doshida, a senior market analyst at Rakuten Securities. "That means Japanese shares are no longer looking so cheap compared to U.S. or German stocks, which may blunt the rally," he said.