TOKYO: Japan’s Nikkei share average closed higher on Tuesday, driven by chip-related stocks which tracked overnight gains in the Nasdaq, while investors awaited Nvidia’s quarterly earnings.

The Nikkei rose 0.51% to 38,414.43, while the broader Topix climbed 0.68% to 2,710.03.

“Some of Japan’s chip-related stocks rose after the US semiconductor chip index snapped six straight sessions of losses overnight,” said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

“Some chip shares also fell as market participants stayed away from active bets ahead of Nvidia’s earnings.” The Nasdaq and S&P 500 closed higher on Monday, recovering some losses as investors anticipate quarterly earnings from Nvidia. Nvidia will report its third-quarter earnings on Wednesday, which investors will parse to assess demand for chips and the sustainability of the AI euphoria that has driven much of the market’s rally this year.

Chip-testing equipment maker Advantest jumped 3.7% and was the biggest boost to the Nikkei. Semiconductor silicon wafer maker Shin-Etsu Chemical rose 1.12%.

Lasertec fell 1.75%, while Tokyo Electron erased early losses to end 0.25% higher.

Banking shares rose on expectation the Bank of Japan would hike rates as soon as next month. The banking index gained 2%, with Sumitomo Mitsui Financial Group and Mizuho Financial Group climbing 3.32% and 2.49%, respectively.