TOKYO, Oct 29 (Reuters) - Japanese stocks rose to the highest in more than a year on Tuesday, as negotiators from the United States and China moved a step closer to scaling back their bruising trade war in a boost to the prospects for corporate earnings.
The benchmark Nikkei benchmark share average ended up 0.47% at 22,974.13. It earlier rose to 23,008.43, the highest since Oct. 11, 2018. So far it is up 14.25% for the year.
Investors flocked to riskier assets after U.S. President Donald Trump said on Monday he expected to sign a significant part of the trade deal with China ahead of schedule but did not elaborate on the timing.
Leaders of the world’s two biggest economies are working to agree on the text for a “Phase 1” trade agreement announced by Trump on Oct. 11. Trump has said he hopes to sign the deal with China’s President Xi Jinping next month at a summit in Chile.
“The rising chance of a partial trade agreement between the United States and China has changed the mood,” said Kiyoshi Ishigane, chief fund manager at Mitsubishi UFJ Kokusai Asset Management Co in Tokyo.
“This is driving gains in Japanese shares. Valuations are still cheap compared to other markets, so this will draw in more funds from overseas.”
Indeed, Tuesday’s gains marked the seventh consecutive winning session for Japanese stocks as investors bought shares of materials makers that export overseas. Shares in the consumer discretionary sector also advanced.
There were 178 advancers on the Nikkei index against 44 decliners on Tuesday.
The largest percentage gainers in the index were Nitto Denko Corp, a maker of materials for chips and automotive products, which rose 6.48%, followed by Sumitomo Dainippon Pharma Co Ltd, up 4.25%, and non-ferrous metal maker Toho Zinc Co Ltd up by 3.71%
The largest percentage losses in the index were healthcare services firm M3 Inc, down 4.79%, followed by video game maker Bandai Namco Holdings Inc losing 3.02% and pharmaceutical company Eisai Co Ltd, which fell 2.13%.
The broader Topix index rose 0.86% to 1,662.68, reaching its highest level since Dec. 4, 2018.
The volume of shares traded on the Tokyo Stock Exchange’s main board was 1.14 billion, compared to the average of 1.24 billion in the past 30 days. (Reporting by Stanley White; editing by Richard Pullin & Shri Navaratnam)