Japan’s Nikkei share average rose to a fresh seven-year high on Monday as strong corporate spending lifted the sentiment, with airline shares extending gains as oil prices tumbled further.
Exporters were also in demand after the dollar rose to a new seven-year high against the yen.
The Nikkei rose 0.9 per cent to 17,615.14 points by mid-morning after climbing as high as 17,649.02, the highest since July 2007.
The 5.5 per cent year-on-year rise in capital expenditure over the third quarter reported on Monday is expected to ease concerns about a recovery from a sales tax increase earlier this year.
Such machinery shares benefited from the strong capital spending figures, with Fanuc Corp rising 1.9 per cent and Keyence Corp jumping 2.3 per cent.
Falling crude oil prices continued to help ANA Holdings Inc, which soared 5.3 per cent to 307.6 yen, the highest since February 2011.
Japan Airlines Co climbed 7.2 per cent to 3,740 yen, the highest since the airline spilt its stock on October 1. Tire makers Bridgestone Corp rose 1.1 per cent and Yokohama Rubber Co surged 2.1 per cent.
“Falling crude prices is serving as a tailwind to a developed country like Japan,’’ said Norihiro Fujito, a senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities, adding that the drop in prices would help consumption as well.
“It’s a Thanksgiving gift to the Japanese market,’’ he said.
Crude oil at multi-year lows
US crude fell more than $2 to a five-year low in Asian trade, while Brent futures touched a fresh four-year low. Also lifting risk sentiment was the weak yen after the dollar hit 119.02 on the EBS trading platform, the highest since August 2007.
Toyota Motor Corp rose 1.6 per cent and Honda Motor Co advanced 1.1 per cent. Bucking the strength was Sumitomo Metal Mining Co, which fell 1.8 per cent as gold prices slid 2 per cent after Swiss voters overwhelmingly rejected a proposal to boost central bank gold reserves.
The broader Topix rose 1.1 per cent to 1,425.39, and the JPX-Nikkei Index 400 gained 1.0 per cent to 12,966.49.