TOKYO: Tokyo stocks jumped 1.78 percent on Tuesday, lifted by brighter economic data from the United States and Japan while a weakening yen also provided support.
The benchmark Nikkei 225 index closed up 246.24 points at 14,098.74, while the broader Topix index of all first-section shares climbed 1.84 percent, or 21.14 points, to 1,171.84.
Kenichi Hirano, operating officer at Tachibana Securities, said the Nikkei has likely hit its bottom after weeks of wild volatility saw it briefly dive 20 percent from a five-year high struck in late May.
"The second round of the rally has since begun," Hirano told Dow Jones Newswires.
"As US markets' reaction to signs of possible tapering of quantitative easing and improved US economic data are more positive and worries over China ease, the Nikkei should be back on track to advance at a pace of 800 points or so per month."
In the United States the ISM purchasing managers index rose to 50.9 in June from a contraction reading of 49.0 in May.
Anything above 50 suggests growth while anything below indicates contraction.
The Dow Jones Industrial Average gained 0.44 percent to close at 14,974.96, as investors try to gauge when the Fed will start rolling back its huge stimulus drive, known as quantitative easing.
The Nikkei's rally came as a big jump in the Bank of Japan's quarterly business confidence survey, which was published Monday, indicated government and central bank efforts to boost the economy could be paying off.
In Tokyo, trading giant Mitsubishi rose 3.44 percent to 1,774 yen after announcing it was among the investors in a $2.0 billion deal involving the purchase of a US power plant.
Tokyo Electric Power, operator of the crippled Fukushima nuclear plant, surged 19.12 percent to 623 yen following news reports that it plans to ask the government to approve its resumption of its other atomic power operations.
In currency trading, the dollar strengthened to 99.81 yen from 99.66 yen in New York late Monday.
A weaker yen benefits Japanese exporters and tends to help lift their shares. Sony rose 2.48 percent to 2,186 yen and Toyota added 2.80 percent to 6,230 yen. (AFP)
