Tokyo stocks rallied on Thursday, the start of fiscal 2021, assisted by the strength of technology issues on Wall Street.

The 225-issue Nikkei average gained 210.07 points, or 0.72%, to close at 29,388.87, after losing 253.90 points on Wednesday.

The Topix index of all first section issues rose 3.64 points, or 0.19%, to finish at 1,957.64, following a 23.86-point drop the previous day.

Overnight gains of the tech-heavy U.S. Nasdaq composite index boosted mainly technology stocks in the Tokyo market from the opening bell.

The Bank of Japan’s tankan quarterly survey for March, which showed better-than-expected business sentiment among large manufacturers, also boosted investor sentiment.

The market weakened slightly in the afternoon, reflecting the strengthening of the yen against the dollar.

“Market players welcomed the announcement of U.S. President Joe Biden’s infrastructure spending package as a sign that investments in semiconductor technology will rise, driving up tech stocks,” said Masayuki Otani, chief market analyst at Securities Japan Inc.

Brokers noted that U.S. chipmaking giant Micron Technology’s consensus-beating earnings result and forecast were also behind the rise of Japanese chip-related stocks.

Otani added that economically sensitive issues slid after China’s Caixin manufacturing sector purchasing managers’ index for March underwhelmed market expectations, casting doubt on a steady recovery from the novel coronavirus crisis.

In the TSE first section, falling issues outnumbered advancing ones 1,261 to 861 despite the key stock price indicators’ gains, while 64 issues were unchanged. Volume shrank to 1.245 billion shares from Wednesday’s 1.325 billion shares.

Chipmaking gear manufacturers Tokyo Electron and Screen jumped 4.68% and 6.06%, respectively, amid the tech sector surge.

Toshiba attracted buying after a media report said that two U.S. tech firms are mulling the acquisition of spinoff chipmaker Kioxia.

Insurer Dai-ichi Life surged 9.52% after announcing own share buybacks.

On the other hand, steelmakers JFE and Nippon Steel were among the economically sensitive names that succumbed to selling, falling 5.50% and 3.92%, respectively.

Other major losers included automakers Toyota and Nissan.

In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average climbed 190 points to end at 29,400.

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