TOKYO: Japan’s Nikkei share average rose sharply on Thursday, as investors scooped up stocks, following a heavy sell-off to book profits earlier this week as the new financial year started.
The Nikkei rose as much as 2%, before ending the morning session up 1.65% at 40,101.82.
The broader Topix rose 1.46% to 2,746.14.
“Investors scooped up stocks on dips as a series of sell-off related to profit-booking is over,” said Naoki Fujiwara, senior fund manager at Shinkin Asset Management.
“Their positive view on the Japanese stock market has not changed so it was natural that there was a buying on dips.”
Technology stocks led the gains, with chip-making equipment maker Tokyo Electron rising 1.54%.
Technology start-up investor SoftBank Group climbed 2.04% and robot maker Fanuc jumped 4.09%.
The Nikkei has lost 4.6% from a record-high scaled on March 22 to the previous session’s low.
The index hit successive record highs in March, after crossing levels last seen in 1989 during the country’s bubble economy on Feb. 22.
There was a similar sell-off around this time in April 2023, but it was not as drastic as this year, said Ryotaro Sawada, senior analyst at Tokai Tokyo Intelligence Laboratory.
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Among individual stocks, Kao jumped 5.22%, after Hong Kong-based activist investor Oasis Management said it would start a campaign against the cosmetics firm to redefine its brand portfolio and improve marketing.
Itochu rallied for a second session, rising 1.69% after the trading firm said on Wednesday it aimed to boost profit to a record 880 billion yen from an estimated 800 billion yen in the year just ended.
Itochu, in which Warren Buffett’s Berkshire Hathaway holds a minority stake, surged 6.4% in the previous session.
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