Japan’s Nikkei Stock Average Rise as Defense Shares Gain on Election Poll; Advantest Soars (UPDATE 1)

Reuters

12:23 JST, January 29, 2026 (updated at 17:16 JST)

TOKYO, Jan 29 (Reuters) – Japanese stocks rose on Thursday, led by heavyweight chip-testing toolmaker Advantest, while defense stocks benefited from a media poll showing conservative Prime Minister Sanae Takaichi’s party may win a majority in elections next month.

The broad Topix index .TOPX advanced 0.3% to 3,545.30, reversing earlier losses of as much as 0.8%. The tech-heavy Nikkei .N225 finished flat at 53,375.60, recouping earlier declines of 0.7%.

A Nikkei newspaper poll suggested Takaichi’s Liberal Democratic Party was set to secure a simple majority in the February 8 national election. It currently needs coalition partner Ishin to reach a narrow majority in the lower house.

An LDP victory would give the premier greater leeway in advancing her policy agenda, including bolstering national security and expanding stimulus.

Defense stocks Mitsubishi Heavy Industries 7011.T added 2.1%, Kawasaki Heavy Industries 7012.T jumped 2.5% and IHI Corp 7013.T climbed 2.8%.

Meanwhile, Advantest 6857.T jumped 5.2% after the Nvidia NVDA.O supplier raised its annual profit forecast by 21%.

However, most other Japanese tech shares sold off after Microsoft’s MSFT.O announcement on Wednesday of record spending on artificial intelligence stoked investor worries about a delayed payoff for the broader industry’s massive AI investments.

Tokyo Electron 8035.T dropped 5.6% and Fujikura 5803.T lost 3%.

“If strong outlooks emerge for AI-related sectors, the Nikkei could rise again, but we haven’t reached that point yet,” said Wataru Akiyama, a strategist at Nomura Securities.

Automakers .ITEQP.T rose 2.3%. The sector’s gain follows a 6.7% plunge over the previous three sessions amid a sharp rise in the yen that erodes the value of offshore revenues.

Toyota Motor7203.T, which announced on Thursday that it had retained its crown as the world’s top-selling automaker for a sixth consecutive year, rose 3%.