* Both foreign, retail investors' buying lift markets
* Nintendo extends slide after loss forecast
TOKYO, Jan 21 (Reuters) - The Nikkei average rose more than 1 percent on Tuesday morning after three days of losses, as investors bought back stocks on expectations that Japanese corporate earnings will be strong. A weaker yen, always a key catalyst for the Japanese market, also supported sentiment and lifted currency-sensitive exporters like Toyota Motor Corp. The Nikkei was up 1.4 percent at 15,853.04 in midmorning trade after falling 0.3 percent to a one-week closing low on Monday. The index recovered its 25-day moving average of 15,758.47. Analysts said buying from both foreigners and retail investors buoyed the market, with foreign brokers placing net buy orders for a fifth day before the open. With the third-quarter earnings season just around the corner, investors are hopeful the market may see more rises in the next few weeks, they added. "Investors are interested in companies which are expected to raise their annual forecasts and firms with good ROE," said Hikaru Sato, a senior technical analyst at Daiwa Securities. Junior bourses, where many small- to mid-cap shares are listed, also benefited from retail investors' buying, rising to multiyear highs. The Jasdaq Securities Exchange rose 0.2 percent to 2,183.17, its highest since March 2007, and the second section of the Tokyo Stock Exchange gained 0.1 percent to 3,824.07, its highest since August 2007. "NISA is helping retail investors' interest in attractive shares," said Sato, referring to tax-free Nippon Individual Savings Accounts, a new scheme aimed at driving massive Japanese savings into stocks and mutual funds. The broader Topix added 0.7 percent to 1,302.31. Rakuten Inc, which operates an online-shopping site, rose 3.5 percent to 1,843 yen, its highest since at least 2000, according to Thomson Reuters data. Exporters were in demand as the dollar edged up to 104.16 yen from 103.865 yen. Toyota Motor gained 1.6 percent and Tokyo Electron Ltd added 1 percent. But Nintendo Co dropped 3.1 percent and was the most traded stock by turnover, extending its slide from the day before as investors worried about its loss forecast. On Monday, Nintendo fell as much as 18 percent before ending 6.2 percent lower. "Those who are selling today include long-term investors who don't want to own Nintendo until the management comes up with a hopeful strategy," said a fund manager at a Japanese asset management firm. Panasonic Corp dropped 1.1 percent after Citigroup cut its rating to "sell" from "buy", citing likely lower profit growth in the foreseeable future due partly to its planned impairment losses from the company's recent restructuring. The JPX-Nikkei Index 400, a recently introduced gauge comprised of firms with high return on equity and strong corporate governance, rose 0.8 percent to 11,764.10.