Nikkei ends at one-week high on Wall Street rally, weaker yen

TOKYO: Japanese shares ended higher on Tuesday as investor sentiment was lifted by a tech-led overnight rally on Wall Street, and a softer yen propped up exporters.

The benchmark Nikkei average gained 1.7pc to 22,573.66, its highest close since July 28, while the broader Topix jumped 2.14pc to 1,555.26.

All 33 sector sub-indexes on the Tokyo exchange finished trading in positive territory, led by highly cyclical airlines, land transport and shippers.

Overnight, Wall Street rallied as strong US manufacturing data and gains in tech-related stocks boosted risk appetite, with the Nasdaq settling at a record closing high.

An industry gauge released on Monday indicated US manufacturing activity expanded in July at the fastest pace in more than a year.

Shares of export-oriented automobile makers got a boost from a weaker yen, which edged further away from a 4-1/2-month high hit last week against the dollar.

Mazda Motor surged 10.59pc, while Mitsubishi Motor and Nissan Motor Co rallied 7.18pc and 6.61pc, respectively.

Individual stocks with better-than-expected earnings results also provided a tailwind, prompting investors to lean towards risk-on mood, said Shuji Hosoi, senior market strategist at Daiwa Securities in Tokyo.

Suzuki Motor rose 7.67pc on better-than-expected earnings.

While the automaker posted a 1.3 billion yen operating profit, its worst quarterly performance on record, it was still better than a consensus forecast for a loss of 38 billion yen drawn from six analysts polled by Refinitiv.

Food company Kikkoman Corp jumped 14.11pc to its daily limit on stay-at-home demand hopes, despite a 12.8pc decline in April-June net profit.

Nikkei heavyweight SoftBank Group fell 0.74pc after Reuters reported, citing a person with knowledge of the matter, that the tech conglomerate under-reported income by around 40 billion yen.

Elsewhere, Sony Corp added 4.47pc ahead of earnings later in the day.