TOKYO, Oct 11: Share prices in Tokyo surged 3.8 per cent on Thursday, boosted by robust gains on Wall Street and upturns in bank stocks, brokers said.

The Nikkei 225 average of the Tokyo Stock Exchange rallied 382.13 points to 10,347.01, its highest close since before last month’s terrorist attacks.

“The electrical machinery sector was higher from the outset thanks to the gains in New York yesterday,” said Masatoshi Sato, a broker at Mizuho Investors Securities.

In New York Wednesday, the Dow Jones Industrial Average rose 2.1 per cent to 9,240.86 while the tech-heavy Nasdaq composite jumped 3.6 per cent to 1,626.26.

“Investors bought shares across the board, particularly those in the hi-tech sector after the rise in the Nasdaq composite,” Kazunori Jinnai, senior market analyst at Daiwa Securities SMBC.

Sony and other major issues led the advance in the afternoon, as buying filtered into sectors where selling had run its course.

“A halt in the recent drops in bank stocks also contributed to today’s rise,” Mizuho’s Sato said.

News reports early Thursday that mega lender Sumito Mitsui Banking Corp. (SMBC) would announce a downward earnings revision later in the day depressed the banking sector in the morning session.

But it turned up in late trade after the government’s financial watchdog said it would start an unprecedented inspection of Japanese banks to discover the true extent of a mountain of bad loans choking the banking system.

SMBC confirmed its net profit for the first half to September would fall 60 per cent to 40 billion dollars as part of a slew of profit warnings from the nation’s mega banks, dealers said.

The Topix index of all first-section issues climbed 33.49 points to 1,064.66 with turnover coming to an estimated 710 million shares against Wednesday’s 598.6 million shares.

Electronics giant Sony Corp. rallied 500 yen or 11.6 per cent to 4,820 yen, while chip maker NEC Corp. rallied 10.9 per cent or 110 yen to 1,120 yen.

Kyocera Corp., leading maker of integrated circuit ceramic packages, also gained 520 yen or 7.0 per cent to 7,980 yen.

SMBC rose 15 yen or 2.0 per cent to 756 yen and rival banks also closed higher, with Mizuho Holdings Inc. up 8,000 yen or 2.1 per cent at 388,000 yen, and UFJ Holdings Inc. up 18,000 yen or 3.7 per cent to 502,000 yen.

Square Co. Ltd., best known for its Final Fantasy game series, gained 79 yen or 4.5 per cent to 1,849 yen.

Sega Corp. also climbed 99 yen or 5.6 per cent to 1,849 yen.

“Investors, perhaps, appreciated this industry’s strength against the (volatile economy),” said Hidenori Karaki head of equities at Tokyo Mitsubishi Personal Securities.

The share price of Square, which recently announced a capital tie-up with Sony Computer Entertainment, might test the 2,000-yen level, citing reduced credit risk, said Daiwa Institute of Research analyst Eiji Maeda.

Retail giant Ito-Yokado Co. Ltd. firmed 30 yen or 0.6 per cent to 5,520 yen as it said sales rose 8.3 per cent year-on-year in the six months to August 31, but complained of Japan’s sluggish domestic economy and chilled household spending.—AFP