Expect the 225-issue Nikkei average's upward momentum to continue, analysts say, as the benchmark index hit a new 26-year high Tuesday on the back of gains in U.S. shares and a solid corporate earnings outlook.
The Nikkei ended trading up 0.57 percent at 23,849. 99 after the market reopened following a holiday on Monday. During early trading, it hit 23,952.61, its highest since November 1991. Analysts said risk appetite remained strong as gains extended on Wall Street, even as Friday's release of the U.S. jobs report for December failed to meet expectations. On Monday, the Standard & Poor's 500 index and Nasdaq composite extended their winning streaks while the Dow Jones industrial average edged down 0.05 percent.
Tatsunori Kawai, investment strategist at Kabu.com Securities, said the Nikkei's solid performance was supported by global growth and expectations of strong third-quarter corporate earnings, which will be released beginning late January. Shares were also backed by a weaker yen, he said. The dollar traded at around ¥112.66 late Tuesday compared with ¥110 forecast by most listed companies for the fiscal year ending in March 2018.