Nikkei rises to near 2-week high as U.S. rate fears ebb

* Oil shares higher after oil prices jumped on Monday * Japan shares may stay in a fixed range for now, but will likely gain in summer – analysts * Summer bonuses will likely see a 2.1 pct rise on year – Nomura By Ayai Tomisawa TOKYO, April 7 (Reuters) – Japan’s Nikkei share average rose to a near two-week high on Tuesday as a positive lead from U.S. shares buoyed sentiment thanks to expectations that the Federal Reserve could wait longer before raising interest rates.

The Nikkei 225 was up 1.1 percent at 19,617.46 points by mid-morning after earlier rising as high as 19,628.83, the highest since March 25.

“How the U.S. market would react to the weak jobs data was of concern to investors,” said Nobuhiko Kuramochi, a strategist at Mizuho Securities.

“The market is relieved on views that the Fed will not likely raise interest rates while the economy is seen still fragile.” Underscoring the economic weakness, an ISM report on Monday showed the pace of growth in the U.S. services sector fell in March to its lowest level in three months.

Analysts said the Nikkei’s upside may be capped for the time being, with resistance seen at its 15-year high of 19,778.60 marked on March 23 and uncertainty over the U.S. economy and U.S. multinational companies’ likely weak Jan-March earnings hit by the strong dollar.

But in the longer run, expectations that the Japanese economy will recover based on strong corporate profits and increasing wages will be reflected in its shares, they added.

According to Nomura Securities, Japanese companies’ bonuses are expected to see a 2.1 percent rise on the year this summer, the second straight year of growth.

“This year’s spring wage negotiations have indeed resulted in higher wage increases than seen last year, and we attribute this to greater corporate willingness to distribute earnings to workers,” analysts at Nomura wrote in a note.

Exporters bounced back, with Toyota Motor Corp and rising 1.0 percent and Nissan Motor Co adding 1.1 percent.

Banks also rose, with Mitsubishi UFJ Financial Group gaining 2.5 percent and Sumitomo Mitsui Financial Group rising 1.8 percent.

A jump in oil prices on Monday lifted oil and mining shares.

Inpex Corp gained 4.0 percent and Japan Petroleum Exploration jumped 4.1 percent.

The broader Topix gained 1.2 percent to 1,579.89 and the JPX-Nikkei Index 400 advanced 1.3 percent to 14,365.16.

(Editing by Kim Coghill)