The Nikkei share average rose 2.31 percent, its biggest one-day percentage gain in three months, on Thursday as investors returned to Toyota Motor Corp. and other top firms after sharp falls and an unprecedented early market closure the previous day.
Hoya Corp. and Fujitsu Ltd. advanced following upgrades from brokerage firms, while Softbank Corp. surged after a steep two-day drop.
“Blue-chip companies have nothing to do with the Livedoor investigation, and investors are picking them up on dips. It’s a kind of flight to quality,” said Takahiko Murai, general manager of equities at Nozomi Securities.
He was referring to an investigation into Internet portal operator Livedoor Co. on suspicions of spreading false information to investors, which had been the spark for three days of sharp declines in Tokyo shares.
The Nikkei gained 355.10 points to 15,696.28, its biggest one-day percentage gain since October 2005. It had fallen for the last three sessions, tumbling nearly 7 percent and wiping out more than $300 billion in shareholder value.
The broader TOPIX index rose 2.90 percent to 1,620.29.
Naoyuki Torii, general manager and strategist at Fukoku Capital Management Inc., said the market had fallen to an attractive level, although it may remain in range for a while as the quarterly earnings reporting season for major Japanese companies starts.
“I think investors will pick up stocks with good earnings prospects,” he said.
Torii also said he would keep an eye on oil prices, which have been rising on growing concerns about Iran’s standoff with the West over its nuclear program.
“We have to be careful not to put too much focus on domestic matters as there are troubling issues going on around the world” which could affect the stock market, he said.
Toyota Motor, the world’s second largest auto maker, gained 2.3 percent to 5,910 yen. It had fallen 3.2 percent since Monday.
Hoya, Fujitsu gain
Hoya, an electronics parts maker, rose 4.8 percent to 4,400 yen after Nikko Citigroup upgraded its rating on the stock, while Fujitsu advanced 3.6 percent to 1,029 yen after Credit Suisse First Boston raised its target price to 1,540 yen from 800 yen.
Hoya is expected to announce quarterly earnings results on Friday.
Internet conglomerate Softbank jumped 15 percent to 3,840 yen, after having fallen a total of 22.7 percent in the previous two sessions to its lowest close since December 8. The stock was caught up in the selling sparked by the Livedoor investigation.
Nippon Telegraph and Telephone Corp. rose 0.9 percent to 536,000 yen after the company said on Wednesday it sees opportunities for its fiber optics operations from television content.
Chip-related stocks such as Advantest Corp. rebounded from losses in the previous session when Intel Corp.’s worse-than-expected quarterly earnings weighed on the sector.
Advantest, the world’s largest supplier of microchip testers, added 1.1 percent to 12,060 yen. Tokyo Electron Ltd., the world’s second-largest producer of chip-making equipment, rose 2.2 percent to 8,030 yen.
Konica Minolta Holdings Inc. and Sony Corp. may draw attention on Friday. Konica said after the market closed that it would withdraw from the camera and photo business and transfer a portion of its digital single lens reflex camera assets to Sony.
Prior to the announcement, Konica Minolta ended up 3.1 percent at 1,278 yen and Sony added 0.8 percent to 4,900 yen.
Web mall operator Rakuten Inc. also said after the market closed that it had sealed an alliance with American International Group Inc. in the property and casualty insurance business and would form a joint venture in Japan in March.
Rakuten ended unchanged at 104,000 yen.
Meanwhile, Livedoor ended at 416 yen, down by its daily limit of 16 percent from Wednesday. The stock is down 40 percent from its 696 yen closing level on Monday just before the investigation became public.
Local media reports have said Livedoor could be delisted as a result of the investigation, but the Tokyo Stock Exchange denied it was currently considering such action.
Trade activity fell from the previous session, with 2.46 billion shares changing hands on the Tokyo exchange’s first section, but that was still well above last year’s daily average of 2.07 billion shares.