Japanese shares ended 0.82 percent higher on Tuesday, with sentiment lifted by Tokyo's upgrade of the economy in which it used the world "recovery" for the first time in almost a year. The benchmark Nikkei 225 index rose 120.47 points to 14,778.51, reversing a 0.70 percent decline at the start of the day. The Topix index of all first-section shares closed 0.51 percent, or 6.19 points, higher at 1,222.72. Japan's Cabinet Office said in its July report: "The economy is picking up steadily and shows some movements on the way to recovery."
It is the first time it has used the word "recovery" in 10 months, while it also hinted that years of deflation were coming to an end. The upbeat outlook comes after Prime Minister Shinzo Abe's ruling party won upper house elections Sunday, giving him more legislative muscle to press on with a big-spending programme aimed at boosting growth. However, while the comments helped buying a stronger yen caused some drag. The dollar fetched 99.55 yen in afternoon trade, compared with 99.59 yen late in New York and well off the 100 yen in Tokyo on Monday.
"The yen has shown signs of pesky resilience, which will act to cap further stock market advances," said SMBC Nikko Securities general manager of equities Hiroichi Nishi. There were few trading cues in Tuesday's session as investors await Japan's earnings season, with major firms including Panasonic, Honda and Nintendo set to report their quarterly results next week. In stock trading, Fukushima operator TEPCO tumbled 6.68 percent to 656 yen as workers at the crippled plan reported steam inside a battered reactor building for the second time in less than a week.
Camera giant Nikon fell 0.65 percent to 2,283 yen, Sony jumped 3.42 percent to 2,295 yen and Uniqlo clothing chain operator Fast Retailing rose 0.54 percent to 36,650 yen. Nippon Steel & Sumitomo Metal was 3.34 percent higher at 309 yen on a report in the leading Nikkei business daily that the firm and Toyota had agreed on a 10 percent price hike for sheet steel used to make autos.
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