TOKYO, May 21 (Reuters) - Japanese shares ended higher on Friday, as a strong finish on the Wall Street overnight prompted investors to bet on cheap growth stocks, while stable U.S. interest rates also underpinned sentiment.
The Nikkei share average advanced 0.78% to close at 28,317.83, while the broader Topix rose 0.46% to 1.904.69.
Nikkei, which has been under pressure on concerns over slow economic recovery from the COVID-19 lows due to Japan’s stagnated vaccine rollouts, briefly fell by just over 10% earlier this month from a peak hit in February.
“Investors have started feeing comfortable with making bets as share prices have become relatively cheap,” said Jun Morita, general manager of the research department at Chibagin Asset Management.
“And an overnight gain in the Nasdaq and stable U.S. interest rates also boosted sentiment.”
Fast Retailing, known for its Uniqlo clothing brand, gained 1.09%, while chip making equipment maker Tokyo Electron rose 1.31%. Medical equipment maker Olympus jumped 2.05%.
Wall Street’s main indexes rebounded after a three-day slide, buoyed by gains in technology stocks, while the yield on benchmark 10-year Treasury notes fell after factory activity in the U.S. mid-Atlantic region slowed in May.
Takeda Pharmaceutical gained 1.44% after a report that said Moderna Inc is considering manufacturing its COVID-19 vaccine in Japan. Takeda has been handling importation and regulatory filing for the vaccine, which the health ministry officially approved on Friday.
Japan’s biggest oil and gas explorer Inpex slipped 3.86%, making it the biggest percentage loser on the Nikkei, as oil prices dropped sharply on Thursday, when diplomats said progress was made toward a deal to lift U.S. sanctions on Iran.
Its peer Japan Petroleum Exploration lost 3.19%. (Reporting by Junko Fujita; Editing by Rashmi Aich)