TOKYO: Tokyo shares tracked a global rally Tuesday following Emmanuel Macron's first-round French election win, though traders remain on edge as North Korea marks a key military anniversary.
The moderate's first place on Sunday -- and his expected run-off victory over far-right candidate Marine Le Pen on May 7 -- has injected some much-needed confidence into trading floors after a recent run of selling fuelled by geopolitical fears.
There had been concerns that a strong showing for Eurosceptic, anti-immigration Le Pen could see France pull out of the eurozone, or even the EU, leading to the possible collapse of the bloc.
"A rebound was likely for the time being (in Tokyo) as the sense of uncertainty has been significantly reduced regarding the French presidential election -- the biggest risk event in the first half of this year -- as it now seems more likely to come to pass with no surprises," Okasan Online Securities said in a note to clients.
Tokyo's benchmark Nikkei 225 index gained 0.84 percent, or 158.86 points, to 19,034.74 -- having jumped 1.37 percent Monday. The Topix index of all first-section issues added 0.91 percent, or 13.61 points, to 1,516.80 after rising almost one percent the day before.
The gains in Tokyo Tuesday following a global rally Monday, with the Nasdaq on Wall Street posting another record close.
However, North Korea marks the 85th anniversary of the founding of its military Tuesday, with worries leader Kim Jong-Un could use it to stage another nuclear test or missile launch.
The celebrations in Pyongyang come as tensions between the hermit state and the US are stretched following a series of rocket launches and sabre-rattling against Washington while US President Donald Trump has warned Kim not to test him.
"There is a strong sense of caution in the market," Japan Asia Securities' equity strategist Mitsuo Shimizu told Bloomberg News.
But an absence of alarming news in the morning session eased investor fears and "encouraged buying", said Okasan Online Securities.
Investors are also anticipating upcoming company financial results.
"Expectations for solid corporate earnings will support sentiment for local equities, as the foreign-exchange level trading around current levels will mean profit growth," Shimizu of Japan Asia Securities told Bloomberg.
The dollar rose to 110.07 yen in Tokyo from 109.78 yen in New York.
Electronics giant NEC surged 3.45 percent to 270 yen after it upgraded its earnings forecast for the business year to March 2017.
Toyota added 1.65 percent to 5,984 yen, while Mitsubishi UFJ Financial Group rose 2.27 percent to 703.6 yen.
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