TOKYO, Jan 9 (Reuters) - Japanese shares surged on Thursday, recovering all the losses from the previous session, after the United States and Iran signalled their desire to avoid further military conflict.
At 0214 GMT, the Nikkei index was up 1.88% at 23,640.87. It erased Wednesday's 1.57% decline, triggered by Iranian missile attacks on facilities hosting U.S. military forces in Iraq in retaliation to the U.S. killing of a prominent Iranian general last week.
The attack initially roiled global financial markets as it stoked fears of a wider conflict in the Middle East.
However, markets regained their composure after U.S. President Donald Trump said there were no casualties and the United States did not necessarily have to hit back.
Iranian Foreign Minister Mohammad Javad Zarif also said the missile strike "concluded" Tehran's response to the U.S. killing last week of Qassem Soleimani, who was responsible for building Iran's network of proxy armies across the Middle East.
The technology and industrial sectors led the advance as shares of electric parts maker Omron Corp and industrial robot maker Fanuc Corp rose.
There were 217 advancers on the Nikkei index against seven decliners on Thursday.
The largest percentage gainers in the index were semiconductor manufacturing equipment maker Screen Holdings Co Ltd up 6.66%, followed by photography and medical device maker Fujifilm Holdings Corp gaining 5.71% and technology investor SoftBank Group Corp up by 4.91%.
The largest percentage losers in the index were oil and natural gas developer Inpex Corp down 3.45%, followed by oil refiner JXTG Holdings Inc losing 2.67%, and engineering company JGC Holdings Corp down by 1.27%.
The broader Topix index rose 1.45% to 1,726.14.
The volume of shares traded on the Tokyo Stock Exchange's main board was 0.51 billion, compared to the average of 1.12 billion in the past 30 days. (Reporting by Stanley White; Editing by Rashmi Aich)