Drug makers help Nikkei scale fresh 3-decade high

[TOKYO] Japan's benchmark Nikkei share average recovered from early falls on Tuesday to hit a fresh three-decade high, with drug makers leading the charge following a report of another effective Covid-19 treatment.

The Nikkei 225 Index was up 0.14 per cent at 28,177.81 by 0204 GMT, while the broader Topix was down 0.05 per cent to 1,853.96.

"Investors bought back stocks as soon as the market started falling, showing the fundamental strength of demand," said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.

"They got confidence in the market as US futures rose overnight."

Chugai Pharmaceutical surged almost 7 per cent after a report said one of its drugs was effective for Covid-19 treatment, helping boost the drug maker index by 1.52 per cent.

Takeda Pharmaceutical rose 3.22 per cent, Eisai climbed 2.91 per cent, and Shionogi & Co added 1.51 per cent.

Retail stocks also gained, led by a 9 per cent surge in Ryohin Keikaku after the Muji retail stores operator posted a 69 per cent jump in quarterly net profit. Lawson rose 3.86 per cent and Watts Co jumped 9.3 per cent.

Automakers slid after Toyota Motor and Honda Motor said they would cut vehicle production this month due to a shortage of semiconductors.

Toyota Motor fell 1.08 per cent and Honda Motor declined 1.35 per cent.

Meanwhile, semiconductor shares rose on prospects of stronger chip demand, with Tokyo Electron adding 0.66 per cent and Shin-Etsu Chemical climbing 3.13 per cent.

The underperformers among the Topix 30 included Nippon Telegraph and Telephone Corp, which was down 2.17 per cent, and Seven & i Holdings, which lost 1.58 per cent.

REUTERS