TOKYO, Sept 12 (Reuters) - Japanese shares ended nearly 1% higher on Tuesday, with automakers leading the gains, as the yen's retreat from a one-week high lifted exporter stocks and risk appetite.

The Nikkei index rose 0.95% to close near a session high of 32,776.37. The broader Topix ended 0.82% higher at 2,379.91.

"The yen retreated from its sharp gains, which gave comfort to investors," said Shuutarou Yasuda, a market analyst at Tokai Tokyo Research Institute.

"And the Japanese government bond yields stayed flat at yesterday's highs and those on mid-terms even fell. Investors were relieved to see the limit on the rise of the yields."

The Japanese yen and equities typically move in opposite directions, since a stronger currency hurts exporters' competitiveness and also makes stocks more expensive for foreigners.

The yen strengthened and the Japanese government bond yields hit multi-month high on Monday after Bank of Japan Governor Kazuo Ueda signalled the end of the negative rate policy in an interview with a local newspaper.

Shares of Toyota Motor rose 2.4% to lead the gains on Topix index on Tuesday, while the transport sector jumped 2.04% to become the top gainer among the Tokyo Stock Exchange's 33 industry sub-indexes.

Game and audio equipment maker Sony Group rose 1.2%, while Uniqlo brand owner Fast Retailing climbed more than 1% to be the biggest boost to the Nikkei.

Technology start-up investor SoftBank Group advanced nearly 2%.

Heavy machinery maker IHI tanked 15.8% to become the worst performer in the Nikkei, while steel makers lost 0.7% and were the biggest laggards in the benchmark index.

(Reporting by Junko Fujita; Editing by Sherry Jacob-Phillips)