Japanese shares advanced on Thursday as investors cheered Wall Street's overnight gains, thanks to signs of easing Sino-US trade tensions, with technology firms getting a boost from a rally in their US peers.
The benchmark Nikkei share average was up 0.99 per cent at 21,817.62 for the second straight day of gains, touching 21,822.54 ealier - its highest since December 5.
Global equities slumped at the start of the week on persistent concerns over tense Sino-US trade relations. But investors have slowly stepped back into riskier assets in the last couple of days on hopeful signs of progress in talks between the world's top two economies.
Chinese state-owned companies have bought more than 1.5 million tonnes of US soyabeans, Reuters had reported on Wednesday, in the first major US soyabean purchases in more than six months - the latest sign of easing tensions between the two sides.
“The Nikkei is up, but the market is now awaiting a fresh round of incentives to test further highs. Sellers meanwhile are locking in profits, limiting the market's rise,” said Takashi Hiroki, chief strategist at Monex Securities.
“Negative market sentiment does not last indefinitely. Trade conflict developments can be seen as an opportunity as they provide the market with incentives.”
Shares of technology-related companies advanced after the S&P technology sector, which is heavily exposed to China trade, gained overnight. Panasonic Corp rose 1.4 per cent, Rohm Co gained 1.65 per cent and Canon Inc climbed 1 per cent. Takeda Pharmaceutical Co surged 7 per cent after a rating upgrade by Tokai Tokyo Research Institute.
The decliners included entertainment facilities operator Tokyo Dome Corp, which sank 2.1 per cent after reporting that its net profit fell 17.7 per cent to ¥6 billion ($52.9 million) in the nine months through October.
Of 33 subsectors of the Tokyo Stock Exchange (TSE) all but three were in positive territory. The broader Topix gained 0.69 per cent to 1,617.74.