Nikkei closes at 30 as Biden inauguration sparks optimism

TOKYO, Jan.21 (Reuters) – Japanese stocks hit their highest closing level in 30 years, building on strong overnight performance on Wall Street, investor optimism over top corporate earnings and the massive stimulus package of the new US administration will support growth.

The Nikkei stock average rose 0.82% to 28,756.86, the highest close since August 1990, while the larger Topix rose 0.6% to 1,860.64.

Republicans in the U.S. Congress have indicated they are prepared to work with President Joe Biden on his administration’s top priority, a $ 1.9 trillion U.S. fiscal stimulus package, but some are opposed to the price of the plan.

Asian stocks have reached all-time highs as investors hoped for more economic stimulus from the Biden administration to offset the damage caused by the COVID-19 pandemic.

“The market has risen on expectations for more stimulus packages in the United States,” said Yoshihiro Takeshige, managing director of the investment management department of Asahi Life Asset Management.

“Another positive factor is that Japanese manufacturers may revise their profit forecasts upwards, especially those benefiting from a recovery in the Chinese economy.”

Many companies are lining up to release their quarterly figures, starting Monday. Nidec Corp, which is up more than 10% this month, will be one of the first companies to report the results.

The Dentsu Group jumped 5.26% to become the biggest winner in the index, after a report that the advertising giant is considering selling its Tokyo headquarters, which local media say could reach around 300 billion yen ($ 2.9 billion).

Panasonic jumped 4.97% after the company said it developed storage boxes for the coronavirus vaccine.

SoftBank Group rose 2.9% to a record high after Alibaba Group’s U.S. certificates of deposit rose following the video reappearance of founder Jack Ma.

In the Nikkei index, 132 companies rose, while 84 stocks fell.

The volume of shares traded on the Topix was 1.14 billion, compared to 1.12 billion on average over the past 30 days.