TOKYO, Feb 8 (Reuters) - Japanese shares surged on Monday, with both Nikkei and Topix hitting 30-year highs, as strong corporate earnings lifted investor confidence for an economic recovery from pandemic lows.
The Nikkei share average jumped 2.12% to 29,388.50, the highest level since August 1990, while the broader Topix rose 1.75% to 1,923.95, the highest since June 1991.
That sent the total market value of companies listed on the Tokyo Stock Exchange’s main board to a record high of 712 trillion yen ($6.75 trillion), according to the exchange.
“With the vaccine rollouts and the fall in the number of daily COVID-19 infections, expectations for normalization of the economy is rising,” said Soichiro Matsumoto, chief investment officer Japan at Credit Suisse Private Banking.
“Better-than-expected corporate performance in this environment is also lifting sentiment. Many U.S. firms have reported upbeat results and Japanese companies, particularly those sensitive to overseas demand, are following suit.”
The S&P 500 and Nasdaq indexes on Friday scored their biggest weekly percentage gains since early November, powered by earnings optimism and progress on vaccine rollouts, while Democrats cleared the path for the approval of President Joe Biden’s $1.9 trillion COVID-19 relief package.
At home, Kobe Steel surged 17.47% to lead gains on Nikkei after raising its full-year outlook, while Nippon Steel jumped 10.04% after trimming its annual net loss forecast. JFE Holdings rose 6.57%.
Toyota Motor gained 1.45% ahead of its earnings report on Tuesday.
Railway shares continued to gain, with Odakyu Electric Railway jumping 3.79%, Keio rising 3.88% and East Japan Railway gaining 4.85%.
The stocks that gained the most among the top 30 core Topix names were SoftBank Group, up 4.45 %, followed by Daikin Industries, which rose 4.38%.
The underperformers among the Topix 30 were Sony, down 2.85%, followed by Takeda Pharmaceutical, which fell 0.76%.
$1 = 105.5100 yen Reporting by Junko Fujita; Editing by Devika Syamnath