The Nikkei average retook 16,000 on Thursday after U.S. equities rose overnight and the yen weakened.
The Nikkei gained 224.55 points, or 1.41 percent, to end at 16,140.34. On Wednesday, it retreated 136.26 points.
The Topix finished up 23.01 points, or 1.79 percent, at 1,307.54, after losing 6.64 points the previous day.
The market got off to a firmer start after the Dow closed higher on Wednesday on the back of a rally in crude oil futures prices as data showed an unexpected decrease in U.S. gasoline inventories, brokers said.
Brokers said a pause in the yen’s rise also helped lift the market. In the middle of the afternoon session, stocks accelerated their upswing in line with the yen’s falls, briefly pushing up the Nikkei more than 300 points.
Sellers retreated to the sidelines to see the results of a meeting of the Group of 20 finance ministers and central bank chiefs in Shanghai from Friday amid hopes for efforts to stabilize financial markets, brokers said.
Hopes grew for coordinated action at the G-20 meeting in the wake of recent volatile exchange rate movements, said Masashi Oguchi of Mito Securities Co.’s Investment Information Department.
Domestic demand-oriented issues such as construction firms and realtors also attracted buying on reports that the government plans to propose a supplementary budget of ¥5 trillion yen for fiscal 2016, an official of a bank-affiliated securities firm said.
While small- and mid-cap stocks attracted buying, the upside of mainstay issues was limited.
“Small- and mid-cap issues drew demand thanks to individual positive factors. But due to sharp currency market swings, investors were unable to step up purchases of large-cap issues, many of which are vulnerable to such fluctuations,” Oguchi said.
Rising issues far outnumbered falling ones 1,680 to 209 in the TSE’s first section, while 48 issues were unchanged. Volume grew to 2,398 million shares from Wednesday’s 2,205 million shares.
Among construction firms, Obayashi, Kajima and Zenitaka rose sharply.
Realtors Mitsui Fudosan, and Sumitomo Realty were also buoyant.
Panasonic surged 6.61 percent on a report that the electronics maker plans to boost sales of construction materials for renovation.
Softbank Group climbed 4.81 percent on a report that the mobile phone carrier intends to sell a U.S. online movie distribution subsidiary.
By contrast, Sharp plunged 14.37 percent after announcing the allocation of new shares to Taiwan’s Hon Hai Precision Industry Co. Sharp decided Thursday to come under the wing of Hon Hai in a bid to achieve business reconstruction.
Other major losers included industrial robot maker Fanuc and clothing store chain operator Fast Retailing, both heavily weighted components of the Nikkei average.
In index futures trading on the Osaka Exchange, the March contract on the Nikkei average finished up 270 points at 16,130.