An electronic screen displaying Japan’s Nikkei share average is pictured in Tokyo, Japan March 4, 2024. REUTERS/Kim Kyung-Hoon
TOKYO — Japan’s main stock benchmark breached the 40,000-point level for the first time on Monday, continuing a rapid rise to new peaks this year that has been spurred by corporate governance reform and cheap valuations.
As technology shares jumped, tracking their U.S. counterparts, the Nikkei share average rose 0.79 percent to 40,226.83 by the midday close, smashing through an intraday high of 39,990.23 hit on Friday.
Overseas investors appear to be leading the buying and many seem to be investing from a medium- to long-term perspective, said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.
READ: Asian stocks advance after Nvidia sets off a rally on Wall Street
“I think the market will continue to rise,” he said.
Japanese tech shares were boosted by the ongoing artificial intelligence rally in U.S. stocks that saw the S&P 500 and Nasdaq to record highs on Friday.
Tracks U.S. counterpart
Chip-testing equipment maker Advantest, which counts U.S. artificial intelligence firm Nvidia among its customers, was up 3.9 percent. Chip-making equipment giant Tokyo Electron gained 2.7 percent.
The shares in those two companies added a combined 175 index points to the Nikkei’s 316-point rise during the morning session.
READ: Nvidia adds record $277B in stock market value
Shin-Etsu Chemical, which manufactures semiconductor silicon products, rose 2.2 percent.
JSR Corp, a major maker of photoresists used in chipmaking, jumped 4.4 percent after a media report that state-backed fund Japan Investment Corp (JIC) plans to launch a tender offer for the shares this month.
The broader Topix was up 0.16 percent at 2,713.79.
Among the Tokyo Stock Exchange’s 33 industry sectors, the electric machinery was the third-largest gainer, up 1.2 percent, after pulp and paper firms which climbed 2.1 percent and miners which rose 1.3 percent.