By Brigid Riley
TOKYO (Reuters) -Japan’s benchmark Nikkei got off to a roaring start on Friday, hitting 34-year highs and was on the cusp of eclipsing the all-time peak reached during the hey days of the nation’s bubble economy in the 1980s.
The index blew past the post-economic bubble era record of 38188.74, putting it on course to surpass the life-time high of 38,957.44 reached in December 1989.
The Nikkei share average relinquished some of its early gains but was still up 0.91% at 38,505.89 by the midday close. Of the index’s 225 constituents, 202 advanced while only 21 declined.
“The speed (at which the Nikkei is rising) is faster than I had expected, but I think it’s justified” given fundamental improvements such as corporate governance reform, said Kenji Abe, an analyst at Daiwa Securities.
The broader Topix was up 1.26% at 2624.53.
Japan’s stock market was buoyed by a strong day on Wall Street overnight. U.S. stocks closed higher after U.S. retail sales data declined more than expected, feeding hopes the Federal Reserve will start cutting interest rates in coming months.
Among the stocks leading the charge, entertainment company Bandai Namco Holdings Inc rebounded 7.59% after tumbling on Thursday, followed by insurance firm T&D Holdings Inc, up 6.24%, and Rakuten Group Inc gaining 5.96%.
In megacap shares, Toyota Motor gained 1.06%, Fast Retailing was up 0.94% and telecommunications services firm KDDI Corp rallied 2.37%.
A brief jump in oil prices overnight boosted related sectors, with the oil and coal products Topix subindex up 3.76%.
On the broader economic front, investors were also assessing Thursday’s gross domestic production report showing Japan unexpectedly slipped into a recession at the end of last year, and how that will affect the Bank of Japan’s (BOJ) monetary policy outlook.
BOJ chief Kazuo Ueda appearance before Japan’s parliament on Friday will be closely watched.
(Reporting by Brigid RileyEditing by Shri Navaratnam)
