TOKYO, March 29 (Xinhua) -- Japan's benchmark Nikkei stock index closed higher Wednesday as investors sought out issues before going ex-dividend, with the market receiving support from heavyweight Softbank's rise, although caution remained over the potential for further global bank failures.

The 225-issue Nikkei Stock Average gained 365.53 points, or 1.33 percent, from Tuesday to close the day at 27,883.78.

The broader Topix index, meanwhile, rose 28.81 points, or 1.46 percent, to finish at 1,995.48.

Brokers here said exporters found favor on a comparatively weaker yen versus the U.S. dollar and euro.

The dollar was quoted at 131.97-99 yen at 5:00 p.m. local time, compared with 130.87-97 yen in New York and 131.15-17 yen at 5:00 p.m. on Tuesday in Tokyo.

The euro, for its part, fetched 1.0837-0838 dollars and 143.02-06 yen against 1.0840-0850 dollars and 141.96-142.06 yen in New York and 1.0820-0821 dollars and 141.91-95 yen in late Tuesday afternoon trade in Tokyo.

Local dealers said that investors sought out a wide range of issues, especially those with high dividend payouts.

"The dividend payouts are an end-of-the-year phenomenon, but the weakening yen was an additional boost," Shingo Ide, chief equity strategist at the NLI Research Institute, was quoted as saying.

Other investment analysts concurred that stocks set to go ex-dividend this week attracted enthusiast buying.

"Japanese stocks rose because of demand for shares with higher dividend payouts, while gains in SoftBank Group gave further strength," Shigetoshi Kamada, general manager at the research department at Tachibana Securities, was quoted as saying.

With regards to technology investor SoftBank Group, the sentiment was lifted following China's Alibaba Group Holding Ltd. saying it would split into six units with each looking to secure funding and for them be listed.

SoftBank Group, which has a stake in Alibaba, subsequently leaped 6.2 percent and as a Nikkei heavyweight helped buoy the broader market.

Other heavily-weighted components finding favor included air-conditioning maker Daikin, which added 2.1 percent and Uniqlo clothing store operator Fast Retailing rising 0.9 percent by the close.

Exporters advanced on the yen's retreat, with Mazda Motor accelerating 2.3 percent, while Toyota Motor advanced 2.6 percent. Nissan Motor, meanwhile, was also driven into positive territory, ending the day 2.3 percent higher.

But ongoing fears over the global financial crisis and the potential for further banks in the U.S. and Europe to collapse weighed on sentiment and saw investors opt not to chase the market's upside higher, market strategists here said.

"Doubt has continued to gnaw at investors who are aware that it would not be strange for another financial institution to collapse in the wake of several bank failures," said Ide.

Dragging on the market, chip-making equipment maker Tokyo Electron slipped 0.6 percent, while fellow heavyweight drugmaker Daiichi Sankyo lost 0.2 percent.

By the close of play, mining, rubber product, and transportation equipment-linked issues comprised those that gained the most on the Prime Market.

The turnover on the third trading day of the week came to 3,301.15 billion yen (25.04 billion U.S. dollars). Enditem

Related

Go to Forum >>0 Comment(s)