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TOKYO (Reuters) – Japan’s Nikkei share average jumped more than 1% on Tuesday, as investor sentiment brightened on higher bets of U.S. interest rate cuts this year while technology shares continued to dazzle.
The Nikkei rose 1.57% to 38,835.10, its highest closing level since April 15.
The broader Topix finished up 0.65% at 2,746.22.
U.S. stocks injected fresh momentum as markets priced in a higher chance of the Federal Reserve cutting interest rates this year. A U.S. jobs report on Friday showing growth slowed more than expected in April further fueled buying.
Japanese shares broadly climbed on the positive news, with 152 of the Nikkei’s 225 constituents trading in green.
Local technology shares advanced as investors returning from a long weekend caught up to buoyant Wall Street after U.S. tech giant Apple posted upbeat revenue results. The session’s gains significantly added to the Nikkei’s near 600-point climb.
Japan’s financial markets were closed on Friday and Monday for a public holiday.
After fears had grown that no cuts would be made in 2024, the Nikkei was experiencing a bit of a “relief rally,” said Naka Matsuzawa, chief macro strategist at Nomura Securities.
Some bumps may still be in store, however, as market participants and central bank officials look to upcoming data to confirm the Fed rate-cut story, he added.
In individual stocks, chip-making equipment giant Tokyo Electron soared 5.2% to add 179.47 index points alone, while chip-related firm Disco Corp jumped nearly 9% to become the best percentage performer of the day.
AI-focused startup investor SoftBank Group gained 3.7%. Chip-testing equipment maker Advantest was up 2.3%.
Outside of tech, Nikkei heavyweight and Uniqlo parent firm Fast Retailing rose 3.2% to contribute an additional 126.51 points to the index.
Sony Group Corp and pharmaceutical company Daiichi Sankyo stumbled, declining 2.9% and 3.2%, respectively.
