Japanese Nikkei index reversed the trend and closed higher

Japan’s Nikkei index reversed course to close higher on Monday as investors changed their outlook after local companies posted strong earnings, and Astelas Pharmaceuticals rose after a drug it produces received US approval.

The Nikkei index rose 0.19 percent to close at 32,254.56 points, after falling at the beginning of the session, tracing the losses that Wall Street closed last week’s trading. The Nikkei was down 0.9 percent, its lowest since July 12, earlier in the session.

The broader Topix index also stopped the losses it recorded earlier in the session, to close up 0.41 percent at 2283.93 percent.

“The market tracked the declines in the US markets at the end of last week, while investors were not betting heavily on stocks due to their doubts about the status of Japanese government bond yields,” said Shoji Hosui, chief strategist at Daiwa Securities Group.

However, he added, investor sentiment rose after the improvement in earnings of shares of Japanese companies.

Investors in Japan were looking for the fair value of the benchmark 10-year government bond after the Bank of Japan surprised the market by setting an effective bond yield cap of 1 percent last month.

Japanese drugmaker Astellas Pharma jumped 10.05 percent, providing the biggest boost to the Nikkei index after the US Food and Drug Administration approved a drug produced by the company.

Its peer, Daiichi Sankyo, rose 1.95 percent.

Telecom company KDDI rose 1.06 percent and medical equipment maker Trumo rose 1.28 percent.

Technology stocks negatively affected the Nikkei index, with Tokyo Electron and Advantest falling 1.04 percent and 1.64 percent, respectively.