Tokyo stocks staged a sharp rebound on Tuesday, allowing the benchmark Nikkei average to finish above 23,000 for the first time in nearly 13 months.

The 225-issue Nikkei average closed up 401.22 points, or 1.76 percent, at 23,251.99. The Nikkei last closed above the psychologically important threshold on Oct. 10 last year. On Friday, the key market gauge fell 76.27 points. The Tokyo market was closed on Monday for a national holiday.

The Topix index of all first-section issues on the Tokyo Stock Exchange rose 27.66 points, or 1.66 percent, to end at 1,694.16, after a 0.51-point drop the previous trading day.

The market shot up immediately after the opening bell as investors rushed to make purchases in view of a continued Wall Street rally to send the Dow Jones industrial average to a fresh all-time high on Monday.

Sentiment was brightened by growing optimism that the United States and China are on track to sign the so-called phase one trade deal, brokers said.

U.S. President Donald Trump suggested on Friday that he and Chinese President Xi Jinping would sign the deal in Iowa, while U.S. Commerce Secretary Wilbur Ross said in an interview on Sunday that licenses for U.S. companies to sell components to Chinese telecom giant Huawei Technologies Co. would come shortly.

The market extended gains in the afternoon supported by the yen’s weakening against the dollar and bullish performance of Shanghai stocks, brokers said.

“A risk-on mood grew stronger,” said Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc.

Ross’ latest comment on Tuesday that Washington and Beijing were making good progress toward the phase one signing helped stocks gather steam in the afternoon, Ota noted.

In addition, “a sense of relief spread” after the Financial Times reported that the Trump administration is considering removing some of the tariffs imposed on Chinese goods, said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co.

On the TSE’s first section, rising issues far outnumbered falling ones 1,743 to 356 while 55 issues were unchanged. Volume surged to 1.660 billion shares from Friday’s 1.256 billion shares.

Oil names were higher on the back of Monday’s rise in New York crude oil futures, with Inpex advancing 6.14 percent and Idemitsu 2.21 percent.

Chinese-related issues attracted buying, including construction machinery-maker Komatsu and industrial robot producer Fanuc.

Musical instrument-maker Yamaha jumped 11.95 percent, thanks to its announcement of a plan to buy back own shares.

Also on the positive side were internet portal Z Holdings, formerly Yahoo Japan, and mobile phone carrier KDDI.

On the other hand, MODEC tumbled 17.08 percent, as the engineering firm said that it suffered an operating loss of ¥8.858 billion in January-September.

Among other major losers were camera-maker Konica Minolta and Kyushu Electric.

In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average rose 470 points to end at 23,320.