Nikkei hits 21-year high as banks, tech stocks firm

A woman walks past an electronic board showing the graphs of the recent movements of Japan‘s Nikkei average outside a brokerage in Tokyo on Monday. (Reuters photo)

TOKYO: Japan‘s Nikkei share average surged more than 1% to a fresh 21-year high on Friday, led by banking shares as US yields remained high and by tech shares after their US counterparts posted strong earnings.

The Nikkei rose 1.2% to 22,008.54 points, its strongest closing level since mid-1996. For the week, the index has risen 2.6%, posting seventh straight weeks of gains, the longest weekly winning streak in almost a year.

The broader Topix gained 1.0% to 1,771.05, with 2.0 billion shares changing hands, the highest level in five weeks.

It had risen for a record 16 straight sessions through Tuesday before dipping on Wednesday.

Shares in financial firms, which invest in high-yielding products such as foreign bonds, staged a rally, with Mitsubishi UFJ Financial Group surging 2.8% and Mizuho Financial Group soaring 1.9%.

Insurance stocks were in demand as well, with Dai-ichi Life Holdings rising 1.0 percent and Sompo Holdings adding 0.8%.

On Thursday, the 10-year US Treasury note yield was at 2.453%, up from Wednesday‘s 2.444%. Ten-year yields hit a seven-month peak on Wednesday.

“Since global markets are resilient, foreign investors‘ risk appetite has been strong,” said Mutsumi Kagawa, chief global strategist at Rakuten Securities. “The fact that the dollar is above 114 yen is also supporting the mood.”

The dollar gained 0.2% to 114.20 yen.

Tech shares rose after Amazon Inc, Microsoft Corp, Alphabet Corp’s Google and Intel Corp posted stellar quarterly earnings on Thursday.

Advantest Corp jumped 6.5%, Sumco surged 3.9%, and NTT Data soared 2.8%.

However, Subaru Corp shed 2.6% after sources told Reuters that the automaker failed to follow proper inspection procedures for vehicles destined for the domestic market at a factory in Japan.

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