TOKYO – Japanese stocks surged Tuesday as investor sentiment improved after a long weekend, lifted by a weaker yen, stable U.S. stock markets and reports that Panasonic Corp. may acquire rival Sanyo Electric Co.

The benchmark Nikkei 225 stock average jumped 537.62, or 6.3 percent, to 9,114.60, reversing Friday's 5 percent drop. The broader Topix index added 5.03 percent to 910.70.

The looming U.S. presidential election results, expected Wednesday morning in Asia, kept volume relatively light, analysts said.

Tokyo markets were closed Monday for a national holiday.

Weekend reports Panasonic may acquire rival Sanyo sent share prices of the Japanese electronics makers soaring.

A Sanyo-Panasonic entity would create Japan's biggest electronics maker, surpassing Hitachi Ltd., and would also be among the biggest in the world. Officials from both companies denied Tuesday that any deal has been reached.

Sanyo shares were untraded because of a rush of buy orders, and was at a bid-only 195 yen ($1.96). It had closed Friday at 145 yen ($1.46). Panasonic also shot up, closing up 6.8 percent at 1,614 yen.

Also boosting exporters was a weaker yen, which stood at 98.63 to the dollar Tuesday afternoon. On Friday in Asia, the dollar was trading around 97-yen levels. On Oct. 24, it had fallen to 91 yen.

Toyota Motor Corp. rose 4.2 percent to 3,850 yen, and Sony Corp. gained 6.5 percent to 2,365 yen.

Banks rallied after Credit Suisse upgraded its rating on the sector to "overweight," saying in its report that "all of the negative news concerning banks' deteriorating earnings is probably out now."

The investment bank also cited a threefold increase in the government's emergency credit guarantee program as part of Prime Minister Taro Aso's second emergency stimulus package announced last week.

"Not only is this likely to reduce (small and midsize enterprise) bankruptcies temporarily, it should also boost banks' lending balances considerably," said analyst Shinichi Ina.

Mitsubishi UFJ Financial Group Inc. advanced 4.9 percent to 627 yen, and Sumitomo Mitsui Financial Group Inc. jumped 7.9 percent to 412,000 yen.

Among notable losers, Nissan Motor Co. shed 10.6 percent to 441 yen after reporting Friday a 39 percent drop in fiscal second quarter profit. The plunge triggered speculation that the automaker could slash its full-year dividend.

(Reuters) –
One of Apple Inc's top executives, who was part of the development of the iPod, has decided to leave the company and will be replaced by a former employee of International Business Machine Corp, the Wall Street Journal said.

Tony Fadell, who is a senior vice president of Apple's iPod division and a part of the team involved in the development of the iPhone, is leaving the company citing personal reasons but may remain as a consultant, the paper said, citing people familiar with the matter.

Fadell will be replaced by IBM's Mark Papermaster, the paper said.

Papermaster, who was with IBM for the past 26 years, served as a member of the company's Integration & Values Team since 2006.

IBM sued Papermaster last week to prevent him from joining Apple, citing a noncompeting agreement between him and the company that would prevent him from accepting a job with a competitor until A year after leaving the company.

Apple and IBM could not be immediately reached for comment by Reuters.

(Reporting by Supantha Mukherjee in Bangalore; Editing by David Holmes)

NEW YORK (Reuters) –
A U.S. judge sentenced a former UBS AG (UBSN.VX) executive to 6-1/2 years in prison on Monday for his role in what prosecutors called the most pervasive insider trading ring since the 1980s.

Mitchel Guttenberg, a former institutional client manager in UBS' equity research department, admitted in a guilty plea in February to selling nonpublic information about the bank's stock recommendations.

In handing down the sentence, which includes three years of supervision after his release, Judge Deborah Batts of U.S. District Court in Manhattan said, "from the moment he joined the (UBS) investment review committee he planned to give that information to others to use illegally."

Batts did not fine Guttenberg, who expressed his remorse to his family, the court and his former employer. His lawyer Sean O'Shea described Guttenberg as "a broken man" whose wife had left him, and he was living in his sister's apartment.

Guttenberg was among 13 people, including former employees of Wall Street firms such as Bank of America Corp (BAC.N), Morgan Stanley (MS.N) and Bear Stearns Co Inc, who were criminally charged last year in an insider trading ring.

Guttenberg admitted in court that on numerous occasions between 2001 and 2006 he told two traders about upcoming analyst stock recommendations, including those for Caterpillar Inc (CAT.N) and Goldman Sachs Group Inc (GS.N) shares.

The information about upcoming UBS analysts' upgrades and downgrades was used to execute hundreds of transactions, netting more than $17.5 million, prosecutors said.

In court on Monday, Assistant U.S. Attorney Andrew Fish told the judge that the securities industry is "full of people like Mr. Guttenberg. They have access to information they can use to make millions."

Guttenberg had pleaded guilty to two counts of conspiracy and four counts of securities fraud. He had faced 78 months to 97 months in prison under sentencing guidelines.

The judge ordered Guttenberg to begin his sentence in 60 days. She recommended that he serve his term in the minimum security prison at Fort Dix, New Jersey.

(Reporting by Grant McCool; Editing by Brian Moss)