TOKYO: Japan Nikkei share average rallied 2 percent and the broader Topix rose above the 800 mark for the first time in six months on Wednesday after the Bank of Japan stepped up its asset buying programme the previous day.
The BOJ's surprise move, which included adding 10 trillion yen ($128 billion) to its asset purchase programme, pushed the yen to a 3-1/2-month low against the dollar, lifting the appeal of exporter shares.
Honda Motor Co jumped 3.2 percent and Toyota Motor Corp rose 3.9 percent, while TDK Corp and Komatsu Ltd advanced between 3.9 and 4.5 percent.
Financial shares outperformed the market after the BOJ move, with Nomura Holdings Inc jumping 5.7 percent, Mitsubishi UFJ Financial Group up 3.8 percent and Sumitomo Mitsui Financial Group climbing 4.3 percent.
In afternoon trade, the Nikkei rose to 9,256.08, up 2.3 percent and its highest level since August, and soaring above its 200-day moving average near 9,050 that had been seen as a resistance point.
The broader Topix advanced 1.9 percent to 802.19, rising above the 800 level for the first time in six months. Market participants said the Nikkei could trade in the 9,200 range this week and continue to test higher if the yen continued to soften against the dollar.
"Excess liquidity in the global market is pushing investors back to equities, and the latest move by the central bank (BOJ) has tipped the dollar-yen rates to a favourable range so the market rally looks likely to continue for some time," said Hiroyuki Fukunaga, CEO of Investrust.
The dollar traded at 78.53 yen, having surged more than 1 percent on Tuesday to its strongest since Nov. 1. Yasuo Sakuma, portfolio manager at Bayview Asset Management, said the central bank's easing action could push the Nikkei gradually up to 10,000 or higher in the next few months.
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