TOKYO, March 16 (Reuters) - Japanese shares closed higher on Tuesday, with the Topix index hitting its best level in 20 years, as high-flying technology stocks tracked Wall Street higher on hopes for a strong economic recovery in the United States.
The broader Topix climbed 0.65% to 1,981.50, its highest close since May 14, 1991. SoftBank Group was the biggest boost to the index, followed by Sony, which rose 1.62%.
The Nikkei share average gained 0.52% to 29,921.09.
“The market sentiment is very strong. It’s lifted by the optimism that most of Japanese companies would benefit from the recovery of the U.S. economy,” said Hideyuki Ishiguro, senior strategist at Daiwa Securities.
“Investor confidence was boosted also because the U.S. bond yields retreated. Cash payments to American individuals, followed by the passage of the U.S. economic relief package, is another reason to support the market.”
The S&P 500 and Dow Jones Industrial Average closed at record highs on Monday, while the tech-heavy Nasdaq climbed over 1%.
Japan’s technology shares advanced too, with SoftBank Group jumping 2.41%, Tokyo Electron rising 1.54% and Advantest jumping 3.37%.
In the airline sector, ANA Holdings and Japan Airlines rose 2.35% and 3.85%, respectively, tracking U.S. peers Delta Air Lines and Southwest Airlines , which said leisure bookings were rising.
Travel agency H.I.S. gained 1.42% despite the COVID-19 crisis leading it to a 7.9 billion yen ($72.34 million) quarterly net loss.
E-commerce firm Rakuten Inc fell 1.44% after surging up to 24% on Monday on news about a capital tie-up with Japan Post Holdings.
Ebara Corp was the biggest gainer in the Nikkei index, rising 6.25%, followed by CyberAgent, which rose 4.46%. Kawasaki Kisen followed with a 4.38% rise.
Reporting by Junko Fujita; Editing by Devika Syamnath