- The TSE's air transport index also hit a 15-month high before slipping 0.4% as investors locked in profit.
TOKYO: Japanese shares inched higher on Thursday, as the service sector gained on prospects of economic reopenings and drugmakers rose on reports of government support, though Eisai eased after a big jump following US approval of its Alzheimer's disease drug.
Nikkei share average rose 0.42% to 28,982.70 while the broader Topix added 0.18% to 1,960.60.
Hopes of economic reopenings amid a steady vaccine rollout underpinned real-estate companies, railway operators and airline companies, though some of them started to lose momentum after a steady rally so far this month.
Japan plans to finish vaccinating all citizens who have applied for shots by October-November, Prime Minister Yoshihide Suga said during a debate between party leaders on Wednesday.
Eisai dropped as much as 8.5% after two days of gains by daily limit after US regulators approved the drug, developed by the firm and Biogen, for Alzheimer's disease. Shares of the company are up more than 30% so far this week.
Rival drugmaker Shionogi jumped 7.3% on a local media report that the firm plans to mass-produce its own COVID-19 vaccines.
Chugai Pharmaceutical gained 2.3% and Ono Pharmaceutical rose 1.7% on a media report they will receive government subsidies for their research on COVID-19 drugs.
The Tokyo Stock Exchange's real-estate company sub-index rose 0.7% to hit its highest level since February 2020, with Mitsubishi Estate up 1.6%.
Tobu Railway and Keio Corp - operators of train network in Tokyo and its suburbs - gained 2.3% and 2%, respectively.
The TSE's air transport index also hit a 15-month high before slipping 0.4% as investors locked in profit.
"Some people say their rally on economic reopenings would last only about two weeks. In the past year that has been the case because we were able to contain the COVID-19 only temporarily," said Fumio Matsumoto, chief strategist at Okasan Securities.
"But this time, with vaccines, I think their rally could last much longer albeit with twists and turns."
DIY shop operator Konan Shoji jumped 20% after City Index Eleventh, a Japanese fund backed by veteran activist investor Yoshiaki Murakami, disclosed that it owns more than 5% of the firm's shares.