Nikkei hits 30-year high as financials gain on Democrat control of Senate

TOKYO, Jan 7 (Reuters) - Japanese shares ended higher on
Thursday, with the Nikkei touching a 30-year peak, powered by
financials as U.S. bond yields climbed on hopes of larger
stimulus following a Democrat sweep in two Senate runoffs in
Georgia.
The Nikkei average .N225 closed 1.60% higher at 27,490.13,
hitting its highest level since August 1990 at one point during
the session and snapping a four-day losing streak.
The broader Topix .TOPX added 1.68% to 1,826.30, climbing
above a peak hit late last year to reach its highest level since
October 2018.
Investor appetite was not dented by the chaos in Washington
D.C. after supporters of President Donald Trump stormed Capitol
Hill, forcing Congress to suspend a session to certify
President-elect Joe Biden's victory. "That seemed like the ultimate epitome of four years of
Trump's presidency. But no one thinks the election results will
be overthrown by this," said Takashi Hiroki, chief strategist at
Monex.
Sharp rises in U.S. bond yields boosted shares of Japanese
banks and insurers, big investors in U.S. debt.
Insurer Dai-ichi Life Holdings 8750.T rose 7.4%. Among
banks, SMFG 8316.T gained 5.5%, while Mizuho 8411.T added
3.3% and Mitsubishi UFJ 8306.T rose 3.5%.
Other cyclical, value shares also gained on hopes of a
stimulus package from the incoming Biden U.S. administration.
Steelmakers .ISTEL.T gained 5.2%, with Nippon Steel
5401.T rising 7.8%. Ship builder Hitachi Zosen 6501.T surged
13.7%.
The Democrat victory in the Senate fanned renewed appetite
in renewable energy stock, with Renova 9519.T jumping 10.6% to
a record high.
Domestic leisure-related shares, such as railway companies
.IRAL.T , bounced back even as the government looked set to
impose a one-month state of emergency in Tokyo and three
neighbouring prefectures to curb a spike in COVID-19 cases.
"The economic impact would be much smaller than previous
declarations as it is confined to Tokyo and restrictions will be
limited," said Hiroyuki Ueno, chief strategist at Sumitomo
Mitsui Trust Asset Management.
SoftBank Group 9984.T dropped 1.6% after the news that the
Trump administration is considering adding Alibaba Group Holding
Ltd 9988.HK to its trade blacklist of Chinese companies.
Softbank Group is the largest shareholder of the Chinese
e-commerce giant.