Kyodo news summary -3-

(Japan Economic Newswire Via Acquire Media NewsEdge) TOKYO, Feb. 28 -- (Kyodo) _ ---------- Tokyo stocks rebound in morning on sound Italian debt auction TOKYO - Tokyo stocks rose sharply Thursday morning on a sound Italian debt auction, bouncing back after posting sharp falls in the last two sessions on fears that political gridlock in Italy could reawaken the eurozone debt crisis.

The 225-issue Nikkei Stock Average advanced 208.66 points, or 1.85 percent, from Wednesday to 11,462.63. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 15.40 points, or 1.61 percent, at 969.12.

---------- Gov't proposes ADB chief Kuroda as next BOJ governor TOKYO - The government proposed to the Diet on Thursday the appointment of Asian Development Bank President Haruhiko Kuroda, an advocate of aggressive monetary easing, as the next Bank of Japan governor.

The government of Prime Minister Shinzo Abe has expressed its desire for a central bank chief who will proceed with its policies of fighting deflation to achieve economic recovery.

---------- Abe plans to visit Middle East in April, May for energy talks TOKYO - Prime Minister Shinzo Abe is considering visiting Middle Eastern countries between late April and early May as part of Japan's strategy to secure overseas energy resources, government sources said Thursday.

Abe has yet to finalize his destinations but the United Arab Emirates and others are on the list, said the sources. The tour is planned for Japan's Golden Week holidays, during which he is also expected to visit Russia, possibly staring April 28, before traveling to the Middle East.

---------- Japan's key bond yield flat in morning TOKYO - The yield on the benchmark 10-year Japanese government bond remained flat Thursday morning as buying prompted by hopes of further monetary easing by the Bank of Japan offset earlier selling triggered by sharp rises in Tokyo stocks.

The yield on the No. 327, 0.8 percent issue, the main yardstick of long-term interest rates, ended morning interdealer trading at 0.665 percent, unchanged from Wednesday's close.

---------- Japan industrial output up for 2nd straight month, assessment raised TOKYO - Japan's industrial production grew 1.0 percent in January from the previous month for the second consecutive monthly rise, backed by positive developments seen in global economic conditions and the weakening yen, the Economy, Trade and Industry Ministry said Thursday.

The ministry upgraded its basic assessment of production, saying that it "has bottomed out and shows some signs of picking up." It is the first time since 1995 that the assessment was raised for the second straight month, a ministry official said.

---------- PROFILE: BOJ chief nominee Kuroda advocate of bold monetary easing TOKYO - Asian Development Bank President Haruhiko Kuroda, nominated by the government on Thursday to become the chief of the Bank of Japan, is known as an advocate of aggressive monetary easing and is well known among financial authorities overseas.

Once Japan's vice finance minister for international affairs, 68-year-old Kuroda would be the first bureaucrat from the Finance Ministry to head the central bank without previously being the top finance ministry bureaucrat.

---------- Gov't submits FY 2013 budget to Diet, aims to boost Japan economy TOKYO - The government on Thursday submitted to the Diet a draft budget for fiscal 2013 worth 92.61 trillion yen ($1 trillion), aiming to revitalize Japan's economy with large public works spending.

The government will issue new debt of 42.85 trillion yen to create the initial budget for the year starting April 1. The amount of new borrowing is expected to be smaller than tax revenues for the first time in four years, in a sign of efforts to commit to fiscal discipline.

---------- PROFILE: BOJ deputy chief nominee Iwata prominent easy-money advocate TOKYO - Kikuo Iwata, an economics professor who was nominated as one of the Bank of Japan's two deputy governors on Thursday, is a prominent advocate of drastic monetary easing to overcome the country's nearly two-decade-long deflation.

Iwata, 70, a professor at Gakushuin University in Tokyo, has long urged the central bank to take responsibility for preventing prices from continuously falling by setting a clear inflation target.

---------- PROFILE: BOJ deputy chief nominee Nakaso known as "internationalist" TOKYO - Hiroshi Nakaso, an executive director of the Bank of Japan who was nominated as one of its two deputy governors on Thursday, is known as an "internationalist" adept at global financial issues and crisis management.

If he is approved by the Diet as one of the BOJ's nine Policy Board members, Nakaso, 59, is expected to play a key role in coordination with central banks of other countries, supporting prospective new BOJ Governor Haruhiko Kuroda.

---------- FOCUS: Easing options seen limited despite BOJ leadership change TOKYO - Options for the Bank of Japan to reinforce its monetary easing grip are likely to be limited even if Asian Development Bank President Haruhiko Kuroda, a strong advocate of aggressive easing, takes the helm of the bank in March.

The government's nomination of 68-year-old Kuroda apparently reflects its expectations for the former Japanese vice finance minister for international affairs to utilize his experience in leading an organization and his expertise as a financial diplomat to convey the bank's policy stance to financial circles overseas.

---------- Japan needs to boost intelligence gathering after crisis: report TOKYO - A government panel assessing the Algerian hostage crisis that resulted in the deaths of 10 Japanese nationals last month will call on the country to enhance its intelligence-gathering ability, according to a report set to be finalized later Thursday.

Top government spokesman Yoshihide Suga said the panel will release its final report later in the day. Government sources said the paper is expected to propose that Japan dispatch diplomats fluent in local languages to the southern Sahara and defense attaches to diplomatic establishments in the region.

---------- Gov't proposes ADB chief Kuroda as next BOJ governor TOKYO - The government proposed to the Diet on Thursday the appointment of Asian Development Bank President Haruhiko Kuroda, an advocate of aggressive monetary easing, as the next Bank of Japan governor.

The government of Prime Minister Shinzo Abe has expressed its desire for a central bank chief who will proceed with its policies of fighting deflation to achieve economic recovery.

---------- Dollar rises vs. yen on U.S. stock gain, improved risk appetite TOKYO - The U.S. dollar rose against the yen Thursday morning in Tokyo as strong gains overnight in New York shares lifted sentiment toward the U.S. currency and the Italian government debt auctions improved risk appetite.

At noon, the dollar fetched 92.38-39 yen compared with 92.18-28 yen in New York and 91.83-85 yen in Tokyo at 5 p.m. Wednesday.

---------- Tokyo Grain Exchange officially decides to close in March TOKYO - Tokyo Grain Exchange Inc. officially decided Thursday to cease operations in March due to low turnover, ending its more than 60-year history.

The decision was made at an extraordinary shareholders meeting held the same day. The exchange will be closed after approval by the Ministry of Agriculture, Forestry and Fisheries.

---------- Abe vows to restart Japan's nuclear reactors TOKYO - Japan will restart idled nuclear reactors once their safety has been confirmed to ensure stable power supply and reduce energy costs, Prime Minister Shinzo Abe said Thursday in a statement at odds with public sentiment.

Abe also suggested his government will soon decide to participate in negotiations on a U.S.-led free trade agreement in the Asia-Pacific region, in his first policy speech to a House of Representatives plenary session since he assumed the premiership for the second time in December.

---------- Sharp to accept executives from banks OSAKA - Struggling major Japanese electronics maker Sharp Corp. is making arrangements to accept executives from two major banks in April to secure their support, industry sources said Thursday.

When Mizuho Corporate Bank and the Bank of Tokyo-Mitsubishi UFJ proposed sending executives to Sharp last summer, Sharp was reluctant to approve the proposal, which it thought would reduce its management options, they said.

---------- 2% inflation target could hurt credibility of BOJ's policy: Kiuchi YOKOHAMA - Bank of Japan Policy Board member Takahide Kiuchi warned Thursday that the central bank's setting an unfeasible price goal could "impair the credibility of monetary policy" and said that achieving the 2 percent inflation target it set in January is "not easy." Kiuchi, a former private-sector economist, also said in a speech to business leaders that it is desirable for prices and wages to increase "in a balanced manner" on the back of economic growth, expressing concern about inflation without wage rises.

---------- Seven-Eleven to open 570 convenience stores in Shikoku TOKUSHIMA, Japan - Major convenience store chain operator Seven-Eleven Japan Co. said Thursday it will open a combined 570 shops on the southwestern main island of Shikoku by February 2019, establishing a presence there for the first time in its corporate history.

Seven-Eleven Vice President Kazuki Furuya told a news conference that 140 of the outlets will be opened in the island's four prefectures -- Kagawa, Tokushima, Ehime and Kochi -- by Feb. 28, 2014.

---------- Kishida vows to guard Japan, urges China not to heighten tensions TOKYO - Foreign Minister Fumio Kishida pledged Thursday to protect Japanese territory and called on China to refrain from escalating tensions over the Senkaku Islands.

In his first foreign policy address to parliament, Kishida said there is no territorial issue to be resolved concerning the Japanese-administered islands in the East China Sea, adding that China's maritime assertiveness and opaque military buildup are major regional concerns.

---------- Aso pledges "drastic" steps to beat deflation, revitalize economy TOKYO - Finance Minister Taro Aso pledged Thursday that Prime Minister Shinzo Abe's government will take "drastic" measures to revitalize the country's economy, suggesting previous economic policies had been insufficient to beat Japan's more than decade-long deflation.

"Deflation is a deep-rooted problem that has undermined the Japanese economy" as it has "hampered investment toward the future," Aso said in a speech to parliament.

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