Japan's Nikkei Stock Average rose 0. 32 percent on Friday as gains in retail issues buoyed investors' optimism about an upturn in consumer spending and outweighed profit-taking leading the key benchmark to a positive close on the last day of the trading week. The 225-issue Nikkei Stock Average advanced 36.14 points from Thursday to 11,204.34. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 3.43 points, or 0.35 percent, to 989.42. Brokers said that retail issues were being snapped up on Friday on the back of upbeat earnings results from two major Japanese retailers released yesterday, led by Fast Retailing the operator of the Uniqlo budget apparel stores who saw record profits and sales in the first half of its current business year and Seven & I Holdings, a convenience store operator who also posted upbeat earnings. Equity strategists said that that the latest earnings reports are leading investors to believe that the economic strangle hold is releasing its grip on this sector and is a key gauge of the nation's fiscal health as consumer spending accounts for 60 percent of Japan's GDP. Other analysts were quick to point out however that the market may still be overheating following its recent run of 18-month closing highs and market players were cautiously waiting the outcome of the U.S. corporate earnings season. 'The economy is on a recovery trend, but shares are rising a little too fast considering the pace of economic recovery,' said Kenji Sekiguchi, general manager of strategic research and investment at Mitsubishi UFJ Asset Management Co. 'Market expectations may be too strong.' Tsuyoshi Segawa, an equity strategist at Mizuho Securities Co., said the latest earnings reports made investors think the worst is over for the retail sector, raising hopes consumer spending is increasing. He added however that looking ahead, trading is likely to be ''in a lull'' as earnings reports kick off in the United States from next week, which will be followed by Japanese corporate earnings reports. Retail issues rose with Fast Retailing Co. Ltd. climbing 3.13 percent to 15,470 yen following Japan's largest clothing retailer raising its profit forecast and dividend and seeing sales soar in the U.S. in March. Seven & I Holdings Co. Ltd. surged 6.14 percent to 2,456 yen after saying it would buy back up to 50 billion yen 535.6 million U.S. dollars of its stock, equivalent to 2.21 percent of its shares outstanding, and then cancel them. Department store operator Isetan Mitsukoshi Holdings Ltd. added 1.62 percent to 1,064 yen and counterpart Marui Group Co. Ltd. edged up 0.27 percent to 738 yen. Bic Camera Inc. leapt 6.7 percent to 34,450 yen after the consumer electronics giant raised its full-year operating profit forecast by 20 percent, elevated by solid sales of flat-screen TVs and other products linked to government incentive schemes designed to encourage purchases of energy efficient and models made of eco- friendly materials. Value leader Canon Inc., the world's largest maker of digital cameras, fell 2.8 percent to 4,250 yen as concerns over Greece's fiscal health linger on affecting the company's sales in Europe, brokers said. Further dragging the share price down was Goldman Sachs downgrading the electronics maker to 'neutral' from 'buy,' although it raised its price target to 4,500 yen from 4,200 to reflect upward revisions to its estimates for the business year ending in December 2010. Machine stocks struggled in the wake of the surprising fall in core private- sector machinery orders for February with Komatsu Ltd. shedding 0.62 percent to 1,910 yen and Kubota Corp. dropping 1.30 percent to 837 yen. Mitsubishi Heavy Industries Ltd. relinquished 0.26 percent t 385 yen and industrial robot maker Fanuc Ltd. retreated 0.19 percent to close at 10,240 yen. Banking shares held firm on Friday on ongoing optimism about a global economic recovery and Sumitomo Mitsui Financial Group Inc. added 0.46 percent to 3,275 yen and Mizuho Financial Group Inc. gained 0.53 percent to 188 yen. Megabank Mitsubishi UFJ Financial Group Inc. closed the day flat at 504 yen. Some 2.23 billion shares changed hands on the Tokyo exchange's first section, a rise on Thursday's volume of 2.1 billion shares. Advancing issues outnumbered declining ones by 1,065 to 473. 