TOKYO, Japan (AFP) — Tokyo’s benchmark Nikkei index rose past 20,000 for the first time in six weeks on Tuesday after Wall Street edged up to a new record close and a weak yen lifted exporters.
The bellwether Nikkei 225 index climbed 1.12 percent, or 223.25 points, to 20,132.75 in early trade, breaching the barrier of 20,000 for the first time since early August.
The broader Topix index was up 1.01 percent, or 16.58 points, at 1,665.52.
“The solid US market and a weak yen explain most of today’s rise,” said Toshihiko Matsuno, chief strategist at SMBC Friend Securities.
Japanese politics may also be contributing to the gains, Matsuno said, amid news reports that Japanese premier Shinzo Abe is considering a snap election as early as next month as he sees recovering public support.
“As the ruling camp is unlikely to lose… it’s not a negative factor but is not a big positive factor either,” he told AFP, adding investors would need to watch public reactions as Abe does not have an actual reason to call an election now.
The dollar was trading at 111.53 yen on Tuesday, sharply up from 110.43 yen in Tokyo Friday before the market closed for a three-day weekend, as investors were betting on rises in US interest rates.
Wall Street logged fresh records on Monday in advance of this week’s Federal Reserve meeting, which is expected to announce a drawdown of its massive bond holdings.
The Fed is due to begin a two-day monetary policy meeting in Washington on Tuesday and markets will be watching closely to see how chairwoman Janet Yellen describes recent trends in inflation in the world’s largest economy, looking for clues about the timing of the next interest rate hike.
In Tokyo trade, carmakers were higher due to a weaker yen helping exports. Toyota rose 2.14 percent to 6,619 yen and Nissan was up 1.68 percent at 1,148 yen.
Nintendo jumped 3.79 percent to 39,700 yen.
© Agence France-Presse