TOKYO: Tokyo stocks advanced 1.20 percent Monday, hitting a more than five year high, as the yen's fall accelerated after Japan avoided open criticism about its forex policy at a weekend G7 meeting.
The benchmark Nikkei 225 index closed up 174.67 points to 14,782.21, its best finish since late December 2007, while the Topix index of all first-section shares climbed 1.78 percent, or 21.60 points, to 1,232.20.
Investor sentiment was buoyed after US shares rallied last week to another all-time high on Friday while Group of Seven finance chiefs met in Britain.
Players cheered the outcome of the G7 talks, which vowed not to intentionally set out to weaken currencies, but did not criticise Japan for the yen's rapid fall due to the Bank of Japan's aggressive easing policy.
Japanese media have interpreted the G7's relative silence on the yen as tacit approval of Tokyo's policy, which had drawn stern criticism, particularly in Europe, over fears it could set off a global currency war in which rival nations drive down their units to gain a trade advantage.
Investors further sold down the yen Monday, with the greenback jumping past the 102-yen level in morning Tokyo trade. It later settled back at 101.85 yen, still stronger than 101.62 yen in New York on Friday.
"The dollar's continued advance after Friday's breach of 100 yen should continue to work as tonic for the market," Hiroichi Nishi, SMBC Nikko Securities general manager of equities, told Dow Jones Newswires.
The euro also gained at 132.16 yen from 132.03 yen in US trading.
A weaker yen helps Japanese exporters by making them more competitive overseas and inflating the value of their foreign income, which has translated into rosier financial results in the latest earnings season.
That, in turn, tends to help lift their shares.
Sharp shares jumped 12.44 percent to 506 yen as the volatile stock reacted to a report that the troubled firm plans to cut back on its liquid crystal display television business in Europe, focusing instead on higher-growth markets in Asia.
A separate report, also in the Nikkei business daily, said Sharp would name a new president, booting its current chief after only one year in the job.
Nissan was up 4.51 percent to 1,111 yen and Sony rose 3.80 percent to 1,855 yen on rosy earnings forecasts while All Nippon Airways closed 1.42 percent higher to 214 yen.
JGC rose 1.43 percent to 3,175 yen after the company whose employees were killed in a hostage siege in the Algerian desert earlier this year reported nearly one-fifth gain in net profit for the fiscal year to March.
On Friday, the Dow Jones Industrial Average rose 0.24 percent to 15,118.49, a new all-time closing high. (AFP)
