Stocks gained further ground on the Tokyo Stock Exchange on Wednesday thanks to an overnight advance in U.S. equities, with the key Nikkei average closing above 21,000 for the first time in almost two months.
The 225-issue Nikkei average gained 280.27 points, or 1.34 percent, to end at 21,144.48, the first finish above 21,000 since Dec. 18. On Tuesday, the key market gauge surged 531.04 points.
The Topix index of all first-section issues closed up 16.73 points, or 1.06 percent, at 1,589.33, after climbing 33.20 points the previous day.
The Nikkei recovered the psychologically important line of 21,000 as soon as the Tokyo market opened.
Mitsuo Shimizu, chief strategist at Aizawa Securities Co., said that market participants “bought back (Japanese stocks) hastily after the U.S. equities’ surge” on Tuesday.
According to an official at a bank-affiliated securities firm, optimism that another U.S. government shutdown will be averted partly contributed to Wednesday’s rise.
A risk-on mood spread in the Tokyo market as fears receded to some extent over the U.S.-China trade row after U.S. President Donald Trump suggested the possibility on Tuesday that he would extend the March 1 deadline for a trade deal between the United States and China, brokers said.
Yutaka Miura, senior technical analyst at Mizuho Securities Co., indicated that futures-linked purchases of Japanese stocks were spurred by Trump’s suggestion.
But “it is uncertain whether the Nikkei will consolidate its downside above 21,000” from now on, Miura also said, noting that selling on a rally emerged after the index rose above the threshold.
Rising issues outnumbered falling ones 1,343 to 709 in the TSE’s first section, while 75 issues were unchanged.
Volume inched down to 1.413 billion shares from Tuesday’s 1.460 billion shares.
Oil firm Inpex Corp. jumped 12.46 percent following upward revisions in its consolidated profit estimates for the year ending in March.
Also on the plus side were technology conglomerate Softbank Group Corp. and cosmetics producer Shiseido Co.
By contrast, Kuraray Co. closed 2 percent lower, with investor sentiment battered by the chemical-maker’s downward revision in its operating profit forecast for the year through December last year, brokers said.
Other major losers included drugmaker Astellas Pharma Inc. and Tokai Carbon Co.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average climbed 280 points to 21,160.