Stocks snapped their three-session losing streak on the Tokyo Stock Exchange on Thursday, backed by rises in equities overseas and an easing of the yen.
The Nikkei climbed 210.15 points, or 1.26 percent, to end at 16,852.35. On Wednesday, it fell 140.95 points.
The Topix rose 19.84 points, or 1.49 percent, to close at 1,352.17, after falling 15.39 points the previous day.
The Tokyo market attracted purchases from the outset of Thursday’s trading after U.S. and major European stocks enjoyed gains overnight.
Investors also took heart from the yen’s weakening against other major currencies.
Profit-taking and selling on a rally weighed down the market’s upside after the Nikkei average topped 16,800 later in the morning, brokers said.
Stock prices held firm in the afternoon, but market participants refrained from stepping up purchases, waiting to see the results of the European Central Bank’s monetary policy meeting later on Thursday, according to brokers.
“Rebounds in commodity prices also improved investor sentiment,” said Ryuta Otsuka, strategist at the investment information department of Toyo Securities Co.
New York crude oil futures prices rose to the highest level in three months on Wednesday. The Baltic Dry Index for freight rates advanced for 19 straight sessions through Wednesday.
Nonetheless, the Nikkei’s upside was somewhat limited, particularly in the afternoon, in the absence of fresh market-moving factors. Clear incentives, such as a sharp fall of the yen, would be needed for the Nikkei average to retake 17,000, an official at a midsize securities firm said.
Investors are keenly awaiting the results of the ECB meeting and ECB President Mario Draghi’s remarks at a press conference after the gathering, with the bank expected to take further monetary easing measures, brokers said.
“Unless something surprising comes out, the expected decision of the ECB may not provide a fresh incentive to the market as additional easing has already been priced in,” Otsuka added.
Rising issues far outnumbered falling ones 1,680 to 198 in the TSE’s first section, while 65 issues were unchanged.
Volume decreased to 1,983 million shares from Wednesday’s 2,249 million shares.
Seven & i Holdings surged over 2 percent, a day after U.S. subsidiary 7-Eleven Inc. said that it will acquire 148 convenience stores in Canada.
Other domestic demand-oriented issues were also buoyant on the back of growing investor moves to secure dividends before the end of fiscal 2015 this month. Among them were Japan Tobacco, daily goods maker Kao and railway operator JR Tokai.
By contrast, Kansai Electric was the biggest loser in the first section, with a tumble of 14.74 percent, after Otsu District Court ordered the power supplier on Wednesday to suspend the operations of the recently reactivated No. 3 and No. 4 reactors at its Takahama nuclear plant.
Peers Hokkaido Electric, Kyushu Electric and Shikoku Electric posted hefty losses as well.
Also on the minus side were telecommunications carriers NTT, KDDI and SoftBank and realtors Mitsui Fudosan and Mitsubishi Estate.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average climbed 220 points to end at 16,850.