Japanese shares closed higher on Tuesday, buoyed by technology and growth-oriented stocks following a strong finish on the Nasdaq overnight, while drug makers extended their gains.
The Nikkei jumped 0.96% to 29,441.30, posting its biggest gain since late May, while the broader Topix rose 0.8% to 1,975.48, closing at its highest since early April.
Hopes of global trade recovery and economic reopenings at home underpinned market sentiment, while investors awaited the U.S. Federal Reserve’s two-day policy meeting due to start later in the day.
“Today’s strong market finish is simply a reaction to the gains in the Nasdaq overnight,” said Jun Morita, general manager of the research department at Chibagin Asset Management.
“Investors have regained confidence in the market as COVID-19 vaccine rollouts have been smooth and accelerated.”
Drug makers were the top gainers among the Tokyo Stock Exchange’s 33 sectors with a rise of 1.65%. Eisai jumped 6.59%, making it the biggest gainer on the Nikkei.
Eisai shares have been volatile since the company’s Alzheimer’s drug, developed in partnership with Biogen Inc, got a nod from U.S. regulators last week. The U.S. Food and Drug Administration is facing mounting criticism over the drug approval.
Takeda Pharmaceutical, which is handling the supply of Novavax’s COVID-19 vaccine in Japan, rose 1.69% after clinical tests showed the U.S. firm’s vaccine candidate is more than 90% effective against a variety of variants of the virus.
Tokyo Electron, a leading supplier of chipmaking equipment, advanced 1.68%, while Toyota Motor jumped 1.77% to reach a record high.
Growth stocks led the gains after Nasdaq shares outperformed on Wall Street, with the Topix Growth Index rising 1.09%, compared with 0.53% gains in value shares.
(Reporting by Junko Fujita and Hideyuki Sano; Editing by Shailesh Kuber and Subhranshu Sahu)