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

Credit: REUTERS/ISSEI KATO

TOKYO, Aug 4 (Reuters) - 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 .N225 gained 1.7% to 22,573.66, its highest close since July 28, while the broader Topix .TOPX jumped 2.14% to 1,555.26.

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

Overnight, Wall Street rallied as strong U.S. 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 U.S. 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 7261.T surged 10.59%, while Mitsubishi Motor 7211.T and Nissan Motor Co 7201.T rallied 7.18% and 6.61%, 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 7269.T rose 7.67% 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 2801.T jumped 14.11% to its daily limit on stay-at-home demand hopes, despite a 12.8% decline in April-June net profit.

Nikkei heavyweight SoftBank Group 9984.T fell 0.74% 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 6758.T added 4.47% ahead of earnings later in the day.

(Reporting by Eimi Yamamitsu; Editing by Subhranshu Sahu and Aditya Soni)

((eimi.yamamitsu@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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