June 22 (Bloomberg) -- Japanese stocks advanced, led by breweries and carmakers after Credit Suisse Group AG raised its rating on the nation’s beverage industry and a newspaper said Nissan Motor Co. will build a U.S. factory to make electric cars.

Sapporo Holdings Ltd. surged 18 percent after Credit Suisse lifted its rating to “outperform,” while Kirin Holdings Co. rose 1.8 percent. Nissan, Japan’s No. 3 automaker, added 5.6 percent. Inpex Corp., the nation’s biggest oil driller, dropped 2.4 percent after oil prices fell the most in two weeks.

“People used to wonder when the global economy would hit bottom, but now they’re starting to feel the economy is getting on track,” said Naoteru Teraoka, who helps oversee about $16 billion at Chuo Mitsui Asset Management Co.

The Nikkei 225 Stock Average rose 40.01, or 0.4 percent, to close at 9,826.27 in Tokyo, recovering from an early loss. The broader Topix index added 3.51, or 0.4 percent, to 922.48, with almost three stocks gaining for each that dropped. The value of stocks traded in Tokyo fell to the lowest level since May 27.

Confidence among Japanese manufacturers improved this quarter, the Cabinet Office and Ministry of Finance said today. A separate report from the Trade Ministry showed demand for services rebounded in April for the first time in three months.

The Topix has gained by almost a third since March 12 when the gauge reached a 25-year low. John Lipsky, the International Monetary Fund’s first deputy managing director, said on June 19 that the organization expects to raise its world growth forecasts “modestly upward.”

Beer Sales

Sapporo soared 18 percent to 514 yen, making it the biggest winner on the MSCI World Index. Kirin climbed 1.8 percent to 1,325 yen. Credit Suisse lifted its rating on Sapporo from “underperform” and raised its price estimate for Kirin’s stock by 14 percent to 1,390 yen.

Beer sales will likely be flat in the year ending in December rather than decline, as previously expected, as demand for low-priced brands offsets a drop in restaurant sales, Credit Suisse analyst Yoshiyasu Okihira said in a report dated June 19. Okihira boosted his view on Japan’s alcoholic beverage industry to “market weight” from “underweight.”

Kamigumi Co., a provider of port-harbor transport services, jumped 5.2 percent to 805 yen, and Mitsubishi Logistics Corp. added 5 percent to 1,049 yen. The Topix Warehousing & Harbor Transportation Services Index, which includes both stocks, has declined 5.2 percent this year through today, trailing a 7.4 percent advance in the broader Topix.

“The next theme in the market isn’t clear yet, so investors are snapping up stocks that have lagged behind,” Chuo Mitsui Asset’s Teraoka said.

Electric Cars

Nissan rose 5.6 percent to 599 yen. The automaker and electronics maker NEC Corp. plan to invest as much as $1 billion in a U.S. electric car plant, Nikkei English News reported over the weekend. Fred Standish, a U.S.-based spokesman for Nissan, said the automaker has applied for a loan under the U.S. government program to support fuel-efficient cars, declining to comment further on the Nikkei report.

Fuji Electric Holdings Co. surged 12 percent, while Furukawa Electric Co. rallied 7.4 percent. The companies will jointly develop a component that extends battery life for hybrid cars, the Nikkei said in a separate report.

“In the current market climate, battery shares are looked at as rain from heaven in a drought,” Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Financial Group Inc., wrote in a Japanese-language report today. “People just buy on whatever news they see without carefully examining earnings prospects.”

Inpex lost 2.4 percent to 749,000 yen, while closest domestic rival Japan Petroleum Exploration Co. slipped 3 percent to 5,120 yen. The Topix Mining Index, which includes the two companies, was the biggest loser among 33 industry groups.

Crude oil for July delivery declined 2.6 percent on June 19, the most since June 3. Oil fell as much as 0.7 percent today.

Nikkei futures expiring in September added 0.6 percent to 9,830 in Osaka and gained 0.5 percent to 9,820 in Singapore.

To contact the reporters for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net.

Last Updated: June 22, 2009 03:12 EDT