Japan's Topix hits record high on Wall Street rally, solid earnings
The broader Topix (.TOPX), opens new tab was up nearly 1% at 2,993.14, as of 0206 GMT. Earlier in the session, the benchmark index hit an all-time peak of 2,993.21.
The Nikkei (.N225), opens new tab climbed 0.9% to 41,151.07.
Both indexes were on track for a third consecutive session of gains, provided the current momentum holds.
The three-day rally follows a sharp decline on Monday, when the Nikkei posted its largest drop in two months amid growing concerns over the U.S. economy and trade.
"The market is now convinced that the U.S. economy will not slow down," said Hiroyuki Ueno, chief strategist, Sumitomo Mitsui Trust Asset Management.
"That is important for the Bank of Japan's decision process for raising interest rates. With solid corporate earnings results and a trend for wage increases, the market now expects the BOJ to raise rates by the end of the year," Ueno said.
However, government data released on Wednesday indicated that Japan's real wages fell for a sixth consecutive month in June, as inflation continued to outpace pay growth. The trend clouded the outlook for a BOJ policy shift, with wage growth seen as a key indicator for sustainable inflation.
There is growing expectation that the U.S. Federal Reserve could begin cutting interest rates as early as September to support the economy.
Shares of Mitsubishi UFJ Financial Group (8306.T), opens new tab rose 1.8%, providing the biggest boost to the Topix, while Sumitomo Mitsui Financial Group (8316.T), opens new tab gained 1.56%.
M3's shares surged 22% after Goldman Sachs raised the target price for the medical services platform operator to 2,300 yen from 2,250 yen.
Cosmetic maker Shiseido (4911.T), opens new tab jumped 10%.
Chip-making equipment maker Tokyo Electron (8035.T), opens new tab fell for a third day, falling 2.7% on Thursday to weigh on the Nikkei the most.
Chip-testing equipment maker Advantest (6857.T), opens new tab fell 0.7%.
Shares of chipmakers declined on concerns over a potential slowdown in global chip production after U.S. President Donald Trump said Washington would impose a tariff of about 100% on semiconductor chips imported from countries not producing in America or planning to do so.
Of the more than 1,600 stocks trading on the Tokyo Stock Exchange's Prime Market, 70% advanced and 26% fell, and 3% were flat.
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