Japan’s Nikkei posts a latest high on improving corporate profit prospects

Japan’s Nikkei stock average marked a record high on Tuesday as the outlook for domestic companies’ profits improved.The Nikkei rose 1.32% to close at 52,518.08. The index rose 4% in the first two sessions of the year, a signal of Wall Street’s strength.

The broader Topix also closed at a record high, rising 1.75% to 3,538.44.“The fundamental setting for Japanese equities is strong, so when the market sees positive signs, appetite increases,” said Kazunori Tatebe, chief strategist at Daiwa Asset Management.

‘These fundamentals are based on the shift from deflation to inflation and corporate governance reforms. And domestic investors have become “more willing to buy Japanese stocks,” he said.

Wall Street finished higher overnight, with rising financial stocks helping the Dow Jones Industrial Average to a record high. At the same time, energy companies jumped after a U.S. military strike captured Venezuelan President Nicolas Maduro.

In Japan, refiner Eneos Holdings rose 5.39%, taking the lead in Topix’s oil and coal products index, which rose 4.7% to become the top performer among the 33 industrial sub-indexes of the Tokyo Stock Exchange (TSE). The banking stock index climbed 3.35%, while Mizuho Financial Group rose 5%. Mitsubishi ⁠UFJ Financial Group and Sumitomo Mitsui Financial Group rose almost 3% each.

Chubu Electric Power bucked the trend and fell 9.59%% to become the biggest percentage loser on the Nikkei after the Japanese utility revealed possible problems with earthquake standards used in a nuclear power plant.

Of the more than 1,600 shares on the TSE’s main market, 84% rose, 13% fell and 2% remained flat.