TOKYO: Japan’s Nikkei share average rose on Tuesday, buoyed by financial sector stocks climbing on speculation that the Bank of Japan (BOJ) might raise interest rates again in the near future amid a weakening yen.

The Nikkei was up 0.38% at 39,780.58 by the midday break. Meanwhile, the broader Topix was up 0.78% at 2846.21, securing a fresh high for the year.

With the yen sliding to its weakest in nearly 38 years on Monday, market attention was back on whether or not the BOJ will hike rates later this month to try to slow the currency’s decline.

Insurance firms, up 2.7%, saw some of the biggest gains in the morning session among the Tokyo Stock Exchange’s 33 industry sectors.

Banks also rose 2.2% to edge toward the top.

Investors may also be taking another look at good news from the BOJ’s closely watched “tankan” survey released Monday, which showed firms planned to ramp up capital expenditure and projected inflation to stay around the central bank’s target of 2% in coming years.

“The content was positive, although the stock market didn’t react so much” during the previous session, said Hiroshi Namioka, chief strategist and fund manager at T&D Asset Management.

“It took a little time, but the (mood in the market) has shifted as investors discerned that these foreign and domestic economic indicators that concern Japan’s stock market are improving.”

Among individual stocks, heavyweight Fast Retailing added 0.7% to give the Nikkei the largest boost.

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Pharmaceutical company Daiichi Sankyo jumped 3.8%, while Chugai Pharmaceutical was up 1.9%. T&D Holdings climbed 3.8% and was the top gainer among financial sector firms.

Kawasaki Kisen Kaisha, which is mainly engaged in the marine transportation business, surged 6.1% to become the largest gainer on the Nikkei.