The 225-issue Nikkei average surged over 3 percent to end at a 26-year high on Thursday, the first trading day of 2018, as solid manufacturing data from the United States and China reinforced optimism about the world economy.
The Nikkei ended up 741.39 points, or 3.26 percent, from Friday at 23,506.33, its highest close since Jan. 7, 1992. The broader Topix index of all first section issues on the Tokyo Stock Exchange finished up 46.26 points, or 2.55 percent, at 1,863.82.
Tokyo markets were closed from Monday to Wednesday for New Year’s holidays.
The Nikkei posted the largest daily gain since November 2016 as every industry category on the main section gained ground, led by oil and coal products, securities and electric appliance issues.
Major issues ranging from Toyota Motor to Sony and Nomura Holdings broadly gained, helping the market get off to a strong start in 2018.
Sentiment was boosted by an upswing in global stocks following stronger-than-expected U.S. manufacturing data for December released overnight by the Institute for Supply Management and the Chinese Caixin Manufacturing Purchasing Managers’ Index, released Monday for the same month, which also beat market expectations, brokers said.
“The (Tokyo) market caught up with global equities gains on the back of the data, which confirmed economic expansion at a global scale,” said Maki Sawada, vice president of the investment research and investor services department at Nomura Securities Co.
Shares further widened their gains later, buoyed by buying from overseas investors and solid performances among other Asian markets on Thursday, brokers said.
“More overseas market players flocked to the market in the afternoon amid hopes for higher (Tokyo) stock prices this year,” said Yutaka Miura, senior technical analyst at Mizuho Securities Co.
The market’s focus will shift to U.S. jobs data for December due out Friday, Miura added.
On the first section, advancing issues outnumbered decliners 1,778 to 246 with 39 ending the day unchanged.
Export-related issues were broadly higher as the yen remained relatively weak against the U.S. dollar. The electric appliance sector rose 3.6 percent as a whole while machinery makers gained 3.2 percent.
Tokyo Electron climbed ¥1,260, or 6.2 percent, to ¥21,660 while Screen Holdings surged ¥600, or 6.5 percent, to ¥9,820.
Carmakers also advanced, with Honda Motor gaining ¥124, or 3.2 percent, to ¥3,986 after saying Tuesday it will jointly develop connected cars with Alibaba Group Holding Ltd. to offer online services to drivers.
Energy-linked shares were lifted by an overnight rise in oil prices. Showa Shell Sekiyu grew ¥83, or 5.4 percent, to ¥1,613, with JXTG Holdings up ¥29, or 4.0 percent, at ¥756.
Trading volume on the main section rose sharply to 1.69 billion shares from Friday’s 889.15 million shares.