Nikkei hits 7-month high on Wall Street optimism and strong earnings

Japan’s Nikkei index jumped on Monday to its highest level in more than seven months, buoyed by Wall Street’s gains at the end of last week, as strong corporate earnings increased risk appetite and prompted investors to snap up falling stocks.

The Nikkei rose 1.14 percent to 28,871.78 points, extending gains for the second session, while the broader Topix index rose 0.6 percent to 1984.96 points.

Wall Street closed higher on Friday, with indications that inflation peaked in July boosted investor confidence that a bull market might be on the way, sending the S&P 500 and Nasdaq indexes posting their fourth consecutive weekly gain.

Investors appeared to show little response to data that indicated the Japanese economy recovered at a slower-than-expected pace in the second quarter after the recession caused by COVID-19.

Shares in Sundrag Pharmacies jumped 10.77 percent after increasing dividend expectations.

Daiichi Sankyo rose 14.52 percent after US drugmaker Seegen said an arbitration panel had ruled in favor of the Japanese drugmaker over an agreement between the two companies to use drug technology.

Daiichi Sankyo provided the second biggest boost to the Nikkei index, after technology investor SoftBank Group, whose shares rose 5.17 percent.

And Fast Retailing, owner of clothing stores Uniqlo, advanced 0.92 percent.

Among the losers were Snow Peak, which fell 14.8 percent after the camping equipment seller cut its annual profit forecast.