Tokyo - Japanese shares rose, with the Topix index posting its biggest weekly rally in 18 months, amid optimism for US earnings and European growth.
Stocks pared gains today as the yen strengthened after a doctor tested positive for the Ebola virus in New York City.
Fujifilm Holdings gained 2.5 percent after saying its Avigan drug may be included among experimental Ebola treatments to be tested by aid group Doctors Without Borders.
Hitachi surged 3.6 percent after preliminary profit beat its forecast.
Construction-machinery maker Komatsu climbed 1.5 percent after industry bellwether Caterpillar reported earnings that exceeded estimates.
Japan Airlines fell 0.6 percent, leading carriers lower, after the Ebola case was reported.
The Topix advanced 0.8 percent to 1,242.32 at the close of trading in Tokyo, with all but three of its 33 industry groups climbing.
The measure posted a 5.5 percent advance this week, the most since April 2013, after sliding 12 percent the previous three weeks.
The Nikkei 225 Stock Average added 1 percent to 15,291.64 today.
The yen rose 0.3 percent to 107.95 per dollar after tumbling 1 percent yesterday.
“Strong US earnings are a signal of a strong economy, which means Japan’s economy and earnings will be good,” said Koichi Kurose, Tokyo-based chief market strategist at Resona Bank Ltd.
“America’s economy is big so if the spread of Ebola leads to a withering of the economy there, then the global economy will also wither.”
Ebola Case
Futures on the Standard & Poor’s 500 Index slipped 0.4 percent today.
A New York City doctor tested positive for Ebola after returning from aid work in West Africa, in the first case of the virus diagnosed in the most populous US city.
Officials are monitoring those who were with him before he was hospitalized as they seek to reassure the public that the risk is minimal.
The Topix Pharmaceutical Index led gains among the industry groups on the broader gauge.
Fujifilm gained 2.5 percent to 3,587.5 yen.
The company, which makes the Avigan drug used as part of clinical trials in Ebola patients, said Doctors Without Borders may use the drug among its experimental treatments.
Japan Airlines slid 0.6 percent to 2,878 yen and ANA Holdings lost 0.3 percent to 244.2 yen, with both companies reversing earlier gains following the Ebola report.
The S&P 500 rose 1.2 percent yesterday as earnings from Caterpillar to 3M topped analysts’ expectations and data showed fewer Americans filed applications for unemployment benefits over the past month than at any time in 14 years.
Komatsu climbed 1.5 percent to 2,428 yen.
Robotics maker Fanuc added 1 percent to 18,715 yen. Hitachi Construction Machinery rose 2 percent to 2,015 yen.
The Topix Machinery index posted the second-biggest gain among the industry groups.
Europe Recovery
Economic data yesterday suggested the euro-area economy may have moved a step away from another recession.
A Purchasing Managers’ Index showed manufacturing in the region unexpectedly grew this month, and Spain’s third-quarter unemployment dropped to the lowest since 2011.
German factory activity rebounded from a slump in September.
“Concerns for the global economy are easing following the macro and micro news from the US and Europe,” said Juichi Wako, a Tokyo-based equity strategist at Nomura Holdings, Japan’s biggest brokerage.
“While there are positive and negative Japanese earnings, there’s still room for them to be revised upwards just because of the weaker yen.” - Bloomberg News