TOKYO: Tokyo stocks closed 0.98 percent higher Friday, following gains on US and European markets amid expectations that Europe will act to prop up banks weakened by the sovereign debt crisis.
The Nikkei index at the Tokyo Stock Exchange gained 83.60 points to 8,605.62. The Topix index of all first section shares added 0.64 percent or 4.69 points to 741.55.
The European Central Bank Thursday announced new measures to provide cash-strapped banks with liquidity.
Markets cheered the news of the ECB action to help out lenders as the European Commission called for coordinated action to recapitalise banks and Germany said it should be done without delay.
"With moves to inject capital into European banks, there are signs of a brighter outlook for progress, although full resolution is still far off," Hiroichi Nishi, general manager at SMBC Nikko Securities, told Dow Jones Newswires.
Toshiyuki Kanayama, a senior market analyst at Monex, said: "Selling by foreign investors may be coming to a halt on the back of some progress in the European debt issue."
The market sustained its firmness following the Bank of Japan's widely expected decision to stand pat on its monetary policy.
Caution loomed towards the close, as investors awaited the release later Friday of closely-watched US jobs data and the three-day weekend in Japan.
Sony tumbled 3.74 percent to 1,415 yen after a Wall Street Journal report that it was nearing a deal to buy out Swedish telecom firm Ericsson's stake in their mobile phone joint venture in a push to enhance its smartphone business.
"Sony had not been able to carve out its presence globally (in smartphones) with Ericsson," said Okasan Securities strategist Hideyuki Ishiguro.
"Even if it gets full control of the venture, the competitive landscape of the smartphone industry already seems mapped out," he said.
Softbank jumped 6.50 percent to 2,456 yen on expectation that lower monthly fees than rival KDDI for Apple's iPhone 4S will help the company better compete as its Japan monopoly on the smartphone to end next week.
KDDI rose 1.42 percent to 568,000 yen, with the two mobile operators beginning accepting pre-order reservations for the iPhone 4S model from Friday afternoon.
On Thursday the Dow Jones Industrial Average closed up 183.38 points (1.68 percent) at 11,123.33 following sharp rises in Europe.
The euro bought $1.3430 and 102.86 yen in Tokyo afternoon trade, almost flat from $1.3433 and 103.03 yen late Thursday in New York where the common European currency rose on greater confidence on the eurozone.
The dollar fetched 76.60 yen against 76.69 yen in New York.
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