Japan: Shares end higher on recovery hopes, Topix hits 20-year peak

[TOKYO] Japanese shares closed higher on Tuesday, with the Topix index hitting its best level in 20 years, as high-flying technology stocks tracked Wall Street higher on hopes for a strong economic recovery in the United States.

The broader Topix climbed 0.65 per cent to 1,981.50, its highest close since May 14, 1991. SoftBank Group was the biggest boost to the index, followed by Sony, which rose 1.62 per cent.

The Nikkei share average gained 0.52 per cent to 29,921.09.

"The market sentiment is very strong. It's lifted by the optimism that most of Japanese companies would benefit from the recovery of the US economy," said Hideyuki Ishiguro, senior strategist at Daiwa Securities.

"Investor confidence was boosted also because the US bond yields retreated. Cash payments to American individuals, followed by the passage of the US economic relief package, is another reason to support the market." The S&P 500 and Dow Jones Industrial Average closed at record highs on Monday, while the tech-heavy Nasdaq climbed over 1 per cent.

Japan's technology shares advanced too, with SoftBank Group jumping 2.41 per cent, Tokyo Electron rising 1.54 per cent and Advantest jumping 3.37 per cent.

In the airline sector, ANA Holdings and Japan Airlines rose 2.35 per cent and 3.85 per cent, respectively, tracking US peers Delta Air Lines and Southwest Airlines which said leisure bookings were rising.

REUTERS