Japan stocks sparkle as semiconductor growth beckons

Japan’s Nikkei share average rose for a sixth session in a row to hit a 20-month high on Thursday, as investors cheered chipmaking investment plans and reasonable April trade data, Reuters reported.

The gains are the second such winning streak for the Nikkei in as many months as stocks surf a wave of buybacks and enthusiasm about governance reform. It is up nearly 17% this year, far outshining world stocks’ 8% rise.

The Nikkei was up 1.5% to 30,534 at the mid-session break. The broader Topix rose 0.9% to 2,156 and is at 33-year highs.

Japan’s exports rose 2.6% in April from a year earlier, Ministry of Finance data showed – a little below expectations but investors were taking it in a tough climate.

“Although exports have slowed from the previous month, this result was still relatively good compared to other northeast Asian countries,” analysts at ING said in a note to clients.

“The April trade results further support our view that the Japanese economy will stay on a recovery path.”

Japanese Prime Minister Fumio Kishida also said he expected chipmakers to invest in Japan after a meeting with industry executives, while Micron said it plans spending up to 500 billion yen ($3.7 billion) bringing the latest ultraviolet chipmaking technology to Japan.

Chip-testing equipment maker Advantest was the top gainer on the Nikkei, up 7.4% to a record high. Other chip shares also rose, including Tokyo Electron and Renesas Electron, both up more than 4%.

Among other winners were Sony Group Corp, which jumped as much as 7.3% to a four-month high as it examines a partial spin-off of its financial division.

Power companies were among the top losers, extending falls from Wednesday as they grapple with high fuel prices squeezing profit margins. Japan’s government on Tuesday approved electricity price rises, but had taken months to do so.

Tokyo Electric Power fell about 3% and other similar firms took similar-sized losses.