The Nikkei 225 average kept rising Monday to end above 15,500 for the first time in about six months, helped by purchases reflecting hopes for strong earnings reports from major Japanese firms.
The Nikkei closed 71.53 points higher at 15,529.40, its best finish since Jan. 23. On Friday, the key market gauge climbed 173.45 points.
The Topix climbed 4.72 points to end at 1,286.07 after rising 11.49 points Friday.
The Nikkei opened slightly lower after the Dow Jones industrial average fell to a two-week closing low Friday.
After the initial selling ran its course, however, the Nikkei turned higher later in the morning thanks to a flurry of futures-led buying amid expectations for robust Japanese corporate earnings for the April-June period, brokers said. The earnings reporting season is getting into full swing this week.
The Nikkei remained in positive territory in the afternoon, underpinned by persistent buying interest, brokers said.
The investment climate is favorable due to technical charts and the recent strong performances of the Jasdaq and TSE second-section indexes, an official at a bank-affiliated brokerage firm said.
There is also a view that investors have begun to digest geopolitical risks, including the situation in Ukraine, the official added.
Now that the Nikkei has topped the psychologically important 15,500 line, the index is expected to test its next threshold of 16,000, brokers said.
“Investors need to confirm the upcoming earnings reports, especially from the automotive sector,” said Ryuta Otsuka, a strategist at Toyo Securities Co. But he also said, “I think it won’t be long before the Nikkei touches 16,000 as the supply-demand balance remains favorable.”
Rising issues outnumbered falling ones 1,009 to 623 on the first section, while 182 issues were unchanged.
Volume decreased to 1.931 billion shares from Friday’s 2.090 billion.
Mobile phone carrier NTT Docomo rose on expectations for a pickup in its earnings, brokers said. The company said Friday that its group revenue in the business year to next March should rise 2.9 percent while net profit will rise 3.3 percent while reporting declines in both sales and profit for the April-June first quarter.
Peers SoftBank and KDDI also gained ground.
General contractors Obayashi and Kajima performed well on the back of a media report that the Abe administration has started to consider allowing the establishment of casinos by the time the 2020 Tokyo Olympics roll around.
Also on the plus side were automakers Toyota, Honda and Nissan, robot maker Fanuc and Fast Retailing. Megabanks Mizuho, Mitsubishi UFJ and Sumitomo Mitsui were hunted.
On the other hand, semiconductor-related Tokyo Electron plunged more than 2 percent. Oil developer Inpex slumped, as did realtors Mitsui Fudosan and Sumitomo Realty.
Japan Tobacco, Dai-ichi Life Insurance and brokerage giant Nomura were also out of favor.