Tokyo stocks extended gains Monday as risk appetite increased in response to a record-breaking advance on Wall Street.
The Nikkei 225 average rose 113.44 points, or 0.49 percent, to end at 23,416.76. On Friday, the key market gauge gained 161.77 points.
The Topix, which covers all issues listed on the first section of the Tokyo Stock Exchange, closed 4.05 points, or 0.24 percent, higher at 1,700.72 after leaping 12.27 points Friday.
Buying interest grew in the morning after all three major U.S. stock indexes — the Dow Jones Industrial Average, the S&P 500 index and the tech-heavy Nasdaq composite index — rewrote their record highs Friday amid rekindled hopes for progress in U.S.-China trade talks.
The U.S. rally followed remarks by White House economic adviser Larry Kudlow on Thursday and Commerce Secretary Wilbur Ross on Friday morning showing prospects of Donald Trump and his Chinese counterpart, Xi Jinping, signing a “phase one” trade deal, brokers said.
The TSE turned sluggish in the afternoon due to a lack of fresh trading incentives, but both the Nikkei and Topix rose in the final minutes of the session.
“The positive news on the U.S.-China trade front spurred buying of Japanese stocks as well,” said Hirohumi Yamamoto, strategist at Toyo Securities Co.
But he also pointed out that persistent skeptical views over a successful end to the trade negotiations between the world’s economic superpowers and concerns over heightened tensions in Hong Kong prevented stocks from going further north.
“The talks have produced nothing concrete as yet,” an official at a bank-affiliated brokerage firm said.
On the first section, rising issues outnumbered falling ones 1,090 to 973 while 90 issues were unchanged. Volume decreased to 1.223 billion shares from 1.365 billion Friday.
Semiconductor-related issues attracted purchases after major U.S. chipmaking equipment manufacturer Applied Materials Inc. beat market earnings projections. Gainers included Japanese peer Tokyo Electron and semiconductor test device maker Advantest
Drugmakers such as Eisai and Takeda rose after U.S. pharmaceuticals fared well on Friday.
Among other winners were technology investor SoftBank Group and clothing store chain Fast Retailing.
Meanwhile, oil names such as JXTG and Idemitsu met with selling.
Cosmetics maker Shiseido extended its losing streak to a seventh session.