Japan's Nikkei hits record high, overheating caution limits gains

By Junko Fujita

TOKYO, Sept 12 (Reuters) - Japan's Nikkei share average hit a record high on Friday, tracking Wall Street's strong finish overnight, but the gains were limited as the market turned cautious about the rally.

As of 0152 GMT, the Nikkei .N225 rose 0.7% to 44,668.23, after gaining as much as 1.16% to a record intraday high of 44,888.02 earlier in the session.

For the week, the index is set to rise 3.8%.

The broader Topix .TOPX rose 0.35% to 3,158.8 and headed for a 1.7% weekly gain.

"Gains of Japanese equities are small relative to the strength of Wall Street," said Seiichi Suzuki, chief equity market analyst, Tokai Tokyo Research Institute.

"That is a sign that investors started feeling that the market is overheated."

Wall Street's main indexes notched record-high closes on Thursday as U.S. inflation and jobless data fuelled expectations that the Federal Reserve will cut interest rates this month. .N

The S&P 500 .SPX climbed 0.85%, while the Nasdaq .IXIC gained 0.72% and the Dow .DJI rose 1.36%.

The Nikkei's strong rally was partly supported by active buying of the Nikkei stock futures ahead of the fixing of special quotation prices, Suzuki said.

The buying of futures slowed after the special quotation, used to set values on index options and futures, settled earlier in the session.

The closely watched settlement price, known in Japan as the special quotation, or SQ, is calculated from the opening prices of the 225 shares in the Nikkei share average on the second Friday of the month.

On Friday, Chip-related Tokyo Electron 8035.T and Advantest 6857.T rose 2.99% and 1.35%, respectively.

Fibre optic cable maker Fujikura 5803.T, a gauge for data centre investments, gained 1.75%.

Uniqlo-brand owner Fast Retailing 9983.T rose 1.56%, providing the biggest boost to the Nikkei.

Technology investor SoftBank Group 9984.T slipped 0.17%, giving back some of the 15% surge this week, which added fuel to the Nikkei's rally.